Caledonia Investments (CLDN ) is reported to have appointed investment bank Evercore Partners to sell Seven Investment Management (7IM), its biggest private equity position at over 6% of assets.

Having reportedly turned down a £300m bid approach from wealth manager Brooks Macdonald (BRK) in February, the global multi-asset fund backed by the Cayzer shipping family is hoping to generate an auction for 7IM that could lift the price tag up to £400m.

However, the valuation and timing of any sale is uncertain due to the turbulent stock market conditions brought on by surging inflation and central bank interest rate hikes, Sky News reported. 

Caledonia bought 7IM for £100m in 2015 and has seen its value on the investment trust’s books rise to £173.9m at the end of March, up from £139m in September.

Recent annual results showed the 40% increase in 7IM over the six-month period followed the successful integration of Partners Wealth Management. Net new fund inflows of about £1.6bn took its assets under management to £20bn.

7IM’s growth contributed to a 54.7% return by the private capital pool in which 28% of the £2bn trust’s assets are invested. The two other main pools, funds (28% of assets) generated a 38.3% return, with a 29% weighting to quoted equity driving 14.6% and 13.7% from capital and income investments respectively. 

All this added up to a 27.9% total underlying investment return that beat the 13% rise for the FTSE All-Share and a 13.2% gain for the MSCI AC World index.

The jewel in the crown of last month’s results, however, was a special dividend of 175p per share, rewarding shareholders with £95m, or 3.4% of net assets, following the lucrative sales of private equity stakes in Deep Sea Electronics and BioAgilytix last year.

On top of 64.8p total ordinary dividends, which rose for a 55th consecutive year, Caledonia paid a total distribution of 239.8p per share, equivalent to a yield of 6.6%.

Next month the company will undergo a change of leadership when chief executive Will Wyatt steps down and is replaced by Mathew Masters, head of its quoted equity team.