Seymour in deal with internet firm

THERE was little festive cheer for Seymour Pierce shareholders when the investment bank revealed that it was effectively paying £50m for cash and investments worth £38.5m.

In its long-awaited deal with internet incubator Antfactory the broker will issue 380m shares to Antfactory's owners, which include a string of venture capitalists, at 13p each, totalling £49.4m. Seymour will also issue $72.5m (£50.3m) of loan notes.

But it will use much of the cash inherited from Antfactory to redeem the notes almost immediately, meaning that it will take £26m cash from the deal and investments valued at £12.5m by Antfactory.

Antfactory shareholders, who include CVC Capital Partners, Citicorp Venture Capital and Allianz Capital Partners, will emerge with 53% of Seymour. The complex deal raises the question of why Seymour did not raise the money on the stock market. Seymour said that the terms were more favourable than it could have achieved through a public offer. Chairman Keith Harris said the money would be used to increase Seymour's asset management business.