Somers Ltd, owner of the Bermuda Commercial Bank, is seeking to buy out London-based broker Westhouse Holdings PLC.

The Bermuda Stock Exchange-listed Somers already owns a 46.1 percent stake in Westhouse.

Somers, formerly known as Bermuda National Ltd, is offering one UK pence in cash per Westhouse share. The offer is the first stage of an equity and debt fundraising of Westhouse, underwritten by Somers, which will include an open offer and placing to raise, in aggregate, up to £3.45 million ($5.64 million) before expenses.

In a statement issued today, Somers said the offer was conditional both on gaining sufficient valid acceptances for Somers to hold more than 50 percent of Westhouse shares, and approval of the change of ownership from UK regulator the Financial Conduct Authority (FCA) by January 28 next year.

The deal already has the support of major Westhouse shareholder SBS Nominees Ltd, on behalf of Ryan Anderson, which owns more than 3.5 million shares, representing a 10.7 percent stake in the company.

Somers chairman Warren McLeland said: “We believe that this proposed fund raising, the strengthening of its management team and the recent cost reduction measures will enable Westhouse to benefit from an upturn in its targeted market.

“The last few years have been difficult for corporate brokers in London but there are signs from Westhouse’s recent trading performance that there is an opportunity to develop a profitable corporate and institutional stockbroking business.

“The proposed offer and investment by Somers will significantly increase our holding in Westhouse and working together with the Westhouse management team will we hope drive value for all Somers shareholders.“

The company statement adds: “Somers has made a significant investment in Westhouse to date, of in aggregate £8.9 million [$14.54 million] and the board of Somers believes an additional investment is an important part of its strategy to continue to strengthen the Westhouse business and thereby create a well-funded corporate and institutional stockbroking business, that is well placed to exploit a cyclical upturn in the UK financial services industry.

“Westhouse is a sectorally focused corporate and institutional broker. It employs over 50 employees and has 70 corporate clients listed on the London capital markets. Westhouse offers corporate finance, corporate broking, sales and trading capabilities, supported by equity research.”

Members of Westhouse’s management team have undertaken to subscribe for £300,000 worth of Westhouse shares in the placing and a further £150,000 of Westhouse shares will be made available by the company to other employees on the same terms as Somers.

“Westhouse will become a subsidiary of Somers following completion of the offer and conditional issue and Somers will therefore be entitled to determine the composition of the company’s board,” the statement adds. “However, the company will remain as an independent entity operating day-to-day functions distinctly and separately from Somers.”

As well as owning BCB, Somers owns a 62.5 percent holding in J O Hambro Investment Management Ltd, a UK wealth manager with $6 billion in assets under management and a 66 percent interest in Private & Commercial Finance Group PLC, a UK asset financing company, and a 58 percent interest in Bermuda real estate company West Hamilton Holdings.