Fund manager Regal Partners Ltd is making its first big move as an ASX-listed company, with a $110 million equity raising in the works to bankroll a few of its strategies and potential M&A.

Only three months after listing via a merger with VGI Partners, Street Talk can reveal Regal’s planning a $110 million rights issue at $2.60 a share in a deal set to launch on Monday morning.

The rights issue is set to test the conviction of VGI Partners’ former shareholders for the first time, and particularly that of its former managing director and founder Robert Luciano who will be asked to tip into the deal.

The deal’s expected to be on about a one-for-five basis, with shareholders offered

one new share for every five they already owned. It would increase Regal’s market capitalisation to about $660 million at the offer price.

VGI investors received 33.3 per cent of the merged Regal Partners Ltd when the transaction settled in June, with Luciano taking 19.4 per cent and his former right-hand man Doug Tynan holding 5.1 per cent. Regal’s founding King family owns 42.5 per cent.

All investors will be offered stock in the raising.

Barrenjoey Capital Partners is expected to lead the trade, while Bell Potter, E&P Financial, Morgans and Shaw and Partners were also involved, sources said. The deal was expected at an 8.5 per cent discount to the last close.

Funds raised would be used to grow Regal’s Resources Royalties Fund and seed its new private credit fund, sources said, while there was also likely to be proceeds left over for potential future acquisitions.

The deal comes two weeks after Regal Partners handed down its maiden financial results. The manager reported $161.1 million net income and $74 million normalised profit after tax in the six months to June 30. It had nearly $5 billion in funds under management at the balance date.

Regal Partners’ strategy, as presented by CEO Brendan O’Connor a fortnight ago, was to grow and scale existing strategies, seed new strategies, invest in its distribution capability and assess and review M&A targets.

Street Talk revealed in May that Regal Partners had been preparing investors for a new private credit strategy, to be run by ex-Goldman Sachs special situations investor Jacob Poke.