* Stake held by Sherborne Investors now at 18.39 pct
* Electra trades flat to net asset value
* Likely may hold stake as did with 3i -Liberum
By Anjuli Davies and Simon Jessop
LONDON, March 17 Activist investor Edward
Bramson has raised his stake in one of Britain's oldest private
equity firms, Electra Private Equity, months after
making hefty profits on the sale of a stake in peer 3i.
Famous for forcing through management shake-ups at his
target companies, Bramson has yet to clarify his plans for
Electra, which has been buoyed by a broad stock market rally as
the outlook for growth improves and fund flows to Europe surge.
Sherborne Investors, Bramson's investment vehicle, now has a
18.39 percent stake in the company, Electra Private Equity said
in a statement on Monday, the third increase announced by
Sherborne since it flagged a 10.24 percent stake on Feb. 28.
In 2011, Bramson had led a boardroom coup in 2011 at British
firm F&C Asset Management, ousting the chairman and
pursuing a root-and-branch shake-up of the 144-year old company
after years of share price underperformance.
New Yorker Bramson raised 207 million pounds in November
2012 to buy shares in an unspecified listed company it
His first target, British private equity firm 3i, netted him
a 38 percent return after he sold a 5 percent stake in November
2013, in what turned out to be a passive investment that
involved no form of activism.
Bramson's plans for his investment in Electra, whose private
equity investment trust was listed on the London Stock Exchange
in 1976, may follow a similar pattern.
"Just like they did in 3i, they're building a material stake
in the company. And I expect them to hold it for a year or so,
or until they've extracted the value they want to achieve,"
Liberum analyst Rob Jones said.
"But Electra is unlike the 3i that existed before (Chief
Executive) Simon Borrows took over the helm, in that it's
already a well-run company, has delivered strong returns over 3,
5 and 10 years and there are no inherent issues there, it has a
clear strategy," he said.
Jones also said it was unlikely to involve an expectation of
an imminent distribution to shareholders.
"I don't think Sherborne would try and push for an increased
rate of distributions to shareholders as Electra's portfolio is
A spokesman for Electra referred back to the company's
previous statement: "We aim to have a constructive dialogue with
all of our shareholders and look forward to engaging with
Sherborne in the same way in due course."
Sherborne could not immediately be reached for comment.
Shares in thinly traded Electra were down 0.4 percent on
Monday. They had posted a record daily gain of 8.6 percent on
That still leaves Electra trading flat to its net asset
value, which Jones said made it pretty fully valued compared
with a sector that trades on a 10 percent discount to NAV to
reflect the inherent illiquidity of the underlying investments.
Just over half of Bramson's stake in Electra, 9.9 percent,
is in the company's underlying shares. The remainder is held
Electra has gross assets of 1.4 billion pounds ($2.33
billion) as at end-Sept. 2013, according to its website and has
sold investments with a total value of 2.5 billion pounds,
including the sale last year of animal tagging firm Allflex on
which it made 15 times its investment.