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Merian Chrysalis raises ‘significantly’ more than £50m

15 April 2019

Richard Watts and Nick Williamson's pre-flotation investment company poised to almost double in size after its share placing is over subscribed following a boost to the portfolio.

Merian Chrysalis (MERI) could be poised to almost double in size after its positive stock market debut convinced investors to set aside their earlier caution.

The investment company, which invests in private companies seeking a stock market flotation, raised £100 million in its initial public offer (IPO) in November during the teeth of a gale in global markets.

Since then its shares have traded at a premium above net asset value amid hopes of the pre-IPO investments made by its star smaller company fund managers Richard Watts and Nick Williamson. These include money transfer firm TransferWise, online travel agent Secret Escapes and the Hut Group, an e-commerce platform.

Last month Merian Chrysalis announced it was taking advantage of investor interest and a growing investment pipeline to raise up to £50 million in a placing of new shares.

Today it said it had raised ‘significantly’ more than its earlier target ‘from a wide range of high quality institutional and private investors’.

It will confirm the total and the number of shares to be issued after the market closes this evening but said the fund raising, overseen by brokers Liberum and Zeus Capital, would be capped at £100 million.

On Friday it set the price of the new shares at 110p, a 1.8% discount to the closing price of 112p on Thursday but an 11.6% premium above their net asset value (NAV) at the end of December.

However, in another piece of good news the listed fund also said it was aware of an expected transaction in one of its portfolio companies.

Although Merian Chrysalis was not participating in the transaction, it said the higher valuation on the investee company would raise its NAV per share by 8.9p to 107.44p.

This would slash the premium on the new placing shares to 2.4%.

Since Friday its existing shares have jumped from just over 110p to 115p, a 15% gain on its flotation price.

Investment company news brought to you by Citywire Financial Publishers Limited.

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