W.H. Ireland (“WHI”) has gained a new and powerful strategic investor in Kuwaiti European Holdings (“KEH”), the vehicle of the highly respected Al– Humaidi family, which has purchased 23% of the shares at 140p per share, a 39% premium to Friday’s closing price.
KEH owns substantial businesses in leisure, property, financial services and healthcare (its Chairman, Dr Abdullah Al-Humaidi has a MD from Trinity College Dublin), including an investment management company in Kuwait and a FCA-regulated firm in the UK. The FCA has approved a “change of control” allowing KEH to buy up to 29.9% of W.H. Ireland (which would give it a degree of influence but not control).
This is not a takeover bid – there would be no point in applying for permission to buy up to 29.9% if a takeover was intended. WHI is to continue as an independent company under the stewardship of CEO Richard Killingbeck.
We can visualise significant benefits: firstly synergies between WHI and the Kuwaiti investment manager (many Kuwaitis wish to invest in the UK), secondly KEH will use WHI’s expertise when making other investments in the UK, thirdly KEH’s access to capital can fund any attractive acquisition opportunities that come WHI’s way. KEH’s largest investment in the UK to date is in the preparatory work for an entertainment park on the Swanscombe peninsula near the Ebbsfleet International Station.
Of course we do not anticipate an overnight transformation – any changes will be (and need to be) gradual as the two parties work out how best to co-operate and develop the relationship.
Initial expectations include WHI providing investment advice to HNW individuals in Kuwait and the Gulf states, especially on investing in UK companies. Also, since UK financial services have a longer history than their Arab counterparts, WHI can act as a design studio for products/investment strategies/wealth planning for Kuwaitis and other residents in the GCC investing in the local market. For the Corporate Broking Division access to capital and distribution is a potential game changer as it seeks to expand its corporate client list. Thirdly WHI’s office on the Isle of Man provides a base for legitimate offshore investment by wealthy Kuwaitis.