Anexo has placed 6 million new shares at a price of 125p to raise approximately £7.5 million before expenses. In addition, three senior members of the management team have sold 2.8 million shares at the same price. The placing and the team’s sales represent 5.5% and 2.55% respectively of the Group’s existing capital. The net proceeds from the primary placing will be used to expand the advocacy and specialist litigation team, headed by Executive Chairman, Alan Sellers, with specific emphasis on funding the acquisition and processing of VW emissions cases. It will also continue recruitment in the legal services business and increase the fleet size. The placing will also support small opportunistic acquisitions. A brief trading update reveals that, although new case numbers were impacted by fewer cars on the road in the early stages of lockdown (and have subsequently recovered steadily), this was mitigated by longer hire periods. Anexo continued to be cash generative in the first four months of 2020 and retains a positive outlook.
Anexo will continue recruitment within Bond Turner, the Legal Services division, and will resume the previously postponed opening of a new office in Leeds. It will invest further in its fleet to return it to a level of available for hire vehicles similar to the level at the end of 2018. The placing will also provide added resources to consider possible acquisitions of small legal and credit hire firms or books of business
Directors Alan Sellers and Samantha Moss and co-founder Valentina Slater have sold 2.8 million shares to raise around £3.5 million. The combined effect of the this and the primary placing should increase the Group’s free float from 26% to 33% -something which investors have been keen to see.
The VW emissions case clearly has significant potential and Anexo expects to add to its current 8,000 clients through a further targeted marketing campaign. The use of a specialist third party funder in tandem with some of the placing proceeds to support the acquisition and processing of new cases will limit the Group’s commitment of its existing resources.
We see this fundraising as a well-timed move to enable the Group to accelerate its involvement in a number of opportunities that are available at the current time. It brings increased flexibility to commit capital to projects without diminishing its existing cash resources.