Thursday 17 January 2019

Investor seeks change to IFG structure as Gallagher and Cotter leave board

IFG’s John Gallagher. Photo: Tony Gavin
IFG’s John Gallagher. Photo: Tony Gavin

Gavin McLoughlin, Business Correspondent

IFG's current structure "fails to adequately recognise" the value of the financial services company's assets, according to one of its largest shareholders.

GVQ Investment Management, the investment manager for London-listed investment trust Strategic Equity Capital, told the Sunday Independent that it believes IFG is a "high-quality, undervalued business".

The comments were made after IFG informed the market of a major overhaul at boardroom and executive level.

Well-known businessman John Gallagher is stepping down as the company's chairman, while chief executive John Cotter is being replaced by non-executive director Kathryn Purves.

The overhaul comes after IFG was unable to conclude a deal to sell its financial planning and investment management arm Saunderson House.

Earlier this year the company publicly said it was considering a sale after a number of approaches. Saunderson is one of two major IFG assets, the other being pensions business James Hay.

"We weren't actively looking to change the management or the board. The company engages well with its shareholders, including ourselves as a major shareholder," GVQ said.

"In response to our and other's views, it explored how best to maximise shareholder value which, culminated in a sales process following inbound interest in Saunderson House. This transaction was pulled as the appropriate buyer wasn't found."

"As such, the decision was made for a new experienced team to come in... there are alternative routes to maximise the value of two high-quality assets, both of which are demonstrating strong operational progress.

"In our view, the current group structure fails to adequately recognise their value when one considers listed peers and other transactions in both the platform and wealth management space.

"We believe it is a high quality and heavily undervalued business."

Sunday Indo Business

Also in Business