The board of AssetCo has submitted an indicative non-binding securities exchange proposal for the entire issued share capital of River and Mercantile (R&M) that is not already owned by AssetCo to the board of R&M.

The offer is made for the remaining R&M asset management business (R&M Asset Management) post the sale of R&M’s Solutions business, and any offer made would be conditional on the completion of the sale of the solutions business.

The sale of the Solutions business also saw R&M’s chief executive James Barnham leave to Schroders along with the business, with one of Mr Gilbert’s former colleague’s, Alex Hoctor-Duncan, taking the helm.

The AssetCo directors believe that R&M Asset Management and AssetCo are highly complementary and that a combination of the businesses would create significant value for the combined group's clients, portfolio managers, employees and shareholders. The AssetCo directors also believe that there is material value in leveraging other elements of the AssetCo business and strategy to increase the value of R&M Asset Management and widen investor appeal.

Whilst negotiations between R&M and AssetCo regarding the structure of a potential deal are continuing, the indicative non-binding proposal to the Board of R&M may lead to a requirement for a reverse takeover pursuant to Rule 14 of the AIM Rules.

AssetCo currently holds 5 million R&M shares representing approximately 5.85 per cent. of its voting rights.

Martin Gilbert, Chairman of AssetCo and deputy chairman of R&M, has recused himself from the firm’s board for the purposes of discussions in relation to the offer.