Peter Field, a former journalist with Euromoney magazine, is to make about £30m after selling the company he founded to Incisive Media.
Incisive has been in talks for months with Risk Waters, a private company started by Mr Field 15 years ago. Incisive shares were suspended in November, pending announcement of the deal, which will more than double the size of the business-to-business publisher. However, the £35.2m cash purchase was held up until the tax implications for Mr Field could be resolved.
Mr Field, 59, wanted to make sure the Inland Revenue would not take 40 per cent of the money he makes by selling up. Under tapering relief on capital gains tax, he has agreed to pay the taxman just 10 per cent of the windfall.
To finance the acquisition, Incisive has a placing and open offer for new shares, to raise up to £16.1m, and it has bank facilities of £22.5m to tap. The company last year walked away from a proposed £60m deal to acquire Pearson's business magazines, including Investors Chronicle. Incisive shares are expected to float again today.
Tim Weller, Incisive's chief executive, said Risk, which has publications on the derivatives and financial technology markets, was a "perfect fit" for his group but this only signalled the start of his company's acquisition ambitions. Mr Weller started Incisive eight years ago with one magazine, Investment Week. It now also publishes Bloomberg Money and Your Mortgage. "This gives us real scale, including offices in New York and Hong Kong. It really is a transforming acquisition for us. We want to be the business that is the consolidator in this sector," Mr Weller said.
After the Risk deal is completed, Mr Weller, 41, will have a 10 per cent stake in the combined group. Incisive also reported 2002 results yesterday, which showed pre-tax profits, before goodwill and exceptionals, up 41 per cent at £4.1m. Turnover was flat at £24m.
Mr Field, who owns 85 per cent of Risk, will continue working for the group, although he said there was no commitment that keeps him there. He said the company had started looking for outside capital 18 months ago, to finance expansion, and this had led to approaches.
He started Risk magazine as a project for Emap in 1987 but the publication was closed a few months later, following the stock market crash of that year and he was made redundant. He used £5,000 from his redundancy money to buy Risk from Emap and has run and grown the business ever since. Last year Risk Waters made profits of £1.5m on turnover of £17.5m.