Stock broker AJ Bell confirmed this week that it will IPO on the London Stock Exchange. This will include and offering of shares to customers. Reports have been circulating in the market for some time that the firm’s founder Andy Bell was considering a listing of the company.
Bell said that he felt that the listing would be a “natural next step” for the firm. He currently owns 44% of the company while fund manager Invesco Perpetual controls 44% and Seneca Investment Managers another 3%.
“We believe the outlook for our business is extremely positive,” Bell said. “The need for people to save and invest for their future has never been stronger and we are making it easier for them to do that.”
The company confirmed that the IPO does not come as a consequence of any need to raise capital. The two largest shareholders said they intended to keep significant holdings after the float. The expected value of the float is thought to be in the £500 million area.
AJ Bell also said that the company’s 172,000 customers would have the opportunity to “share in our success” via an exclusive offer.
Fund manager Neil Woodford’s Woodford Investment Management sold its shares last month to AJ Bell’s management team and to Woodford’s old employer Invesco Perpetual. The Woodford Equity Income Fund had previously held an 8% stake.
Assets invested via the AJ Bell platform, which also serves the IFA market in the UK, have increased by 26% per year every year on average for the past five years. Total assets under administration have passed £42 billion as at 31 December 2017.
In 2017 AJ Bell reported that revenues grew 17% to £75.6 million while the company’s operating model delivered 29% growth in profit before tax to £21.7 million. The dividend has been grown to 10%, equating to a 66% pay out ratio. The broker’s operations are supported by a strong, debt-free balance sheet.
