On 10 November 2017, STM Malta Limited signed a sale and purchase agreement with the shareholders of Harbour Pensions to acquire the entire issued share capital of the company and its related pension trust schemes.
Meanwhile shareholders are left waiting an announcement from the company as to why shares were suspended at 7.30am without immediate explanation.
Earlier this month two STM employees were arrested in Gibraltar and released on police bail including chief executive Alan Kentish.
It is unclear how the suspension relates to the acquisition or the investigation.
STM have said they are backing Kentish, arguing he has no case to answer and calling on the Royal Gibraltar police to speed up their inquiries. The second employee has not been identified by STM.
The firm has described the case as a tax dispute between two jurisdictions over money STM has already correctly paid.
The acquisition
The acquisition is subject to regulatory approval by the Malta Financial Services Authority, a process which STM predicts will take “a few months”.
Harbour incorporates four registered pension schemes with some 1,600 Members and audited revenues in the year to 31 December 2016 of £1.1m ($1.44m, €1.24m).
STM said its board views the Acquisition as a straight forward “bolt-on” to STM’s Malta business, complementing the existing circa 7,500 QROPS members and delivering recurring annual revenues in excess of £0.8 million per annum.
Following integration STM expects to deliver cost synergies and economies of scale of some £0.4 m on an annualised basis.
Sensible exit
In the note on the Harbour acquisition, Kentish made no reference to his arrest on 19 October on suspicion of failure to disclose.
“We are delighted to announce the acquisition of Harbour which will further build our book of business in Malta and allow for additional profit uplift from this jurisdiction,” he said.
“Harbour is a good solid business and the acquisition by STM is a win-win for all parties, giving a sensible exit route for the existing shareholders whilst at the same time ensuring that their existing QROPS members are well looked after going forward.
“As predicted, the QROPS landscape in Malta and Gibraltar was always going to change significantly post March 2017 UK budget announcement.
“The STM executive continues to seek other consolidation opportunities in the QROPS market.”
Justin Caffrey, managing director of Harbour, said: “Harbour was always a five year plan for the team and we are rapidly approaching the end of this period. As entrepreneurs, this move allows us to focus on our other investments within our portfolio.
“It has been a great team effort and I wish to thank all those who contributed to Harbour over the years, and I have very much enjoyed working in the dynamic financial services hub of Malta.
“I am delighted that we were able to reach agreement with STM to acquire Harbour as they are one of the largest independent global pension administrators.”
The terms of the acquisition are confidential for commercial reasons but it will be funded from existing cash reserves.
A spokesman for STM said Kentish’s options were to be “clarified by advisers” and they would be looking to make further announcements as soon as possible.
