Invoice Finance News – Ultimate Finance in merger

Trading in the shares of invoice discounting and factoring firm Ultimate Finance was restored after the company announced the placing of 22.9m shares at 12p each and the £4.75m acquisition of competitor Ashley Commercial Finance.

The shares had previously been suspended from trading.

The consideration for the acquisition will be satisfied through a cash payment of £3.7m and the issue of £1.05m of shares. A deferred consideration of up to £2.7m may be payable, depending on certain financial targets being met.  The acquisition constitutes a reverse takeover under the AIM rules and so is conditional on shareholder approval.  As at 31 March 2010, Ashley had a total loan book of just over £4.4m, net assets of £0.94m and in the year to 31 March 2010 generated an operating profit of £0.69 million.

The enlarged group will be in a good position to provide invoice finance as a viable alternative to bank overdraft facilities as conditions improve, the company said.