Driving around London in the back of a Rolls-Royce in the early 1980s, 12-year-old Jacob Rees-Mogg proudly declared his ambitions: “I’ve always wanted to be rich.”
Already a fervent supporter of the then prime minister Margaret Thatcher, the young man calmly told a French journalist that he had set his plans in motion five years earlier when he invested a £50 inheritance in shares in the public service company GEC.
Now a millionaire many times over, the newly installed business secretary could be in for another windfall from the potential sale of Somerset Capital Management, the investment firm he helped launch in 2007.
It emerged on Thursday that talks were underway to sell Somerset as its co-founder and chief executive Dominic Johnson prepares to follow in Rees-Mogg’s footsteps and switch to a political career.
A sale could result in a multi-million pound payout for the Business Minister, who stopped taking a salary from the company in 2019 but remains an equity partner. His participation is understood to be in the low teens, although that information is not publicly available. In 2018, during inconclusive merger talks with an American company, Somerset was believed to be worth between £70m and £100m. At the time, it managed $10 billion of assets on behalf of a mix of individual and institutional investors, although that sum has since been reduced to $5 billion.
Media reports suggest the staunch Brexiter had pocketed at least £7m in dividends from Somerset since the EU referendum in 2016, and before he stopped taking a salary Rees-Mogg received around £15,000 a month of the company in addition to the salary of its deputy.
Somerset has traditionally invested in listed companies based in emerging markets such as China, Korea, India and Mexico, and is believed to have benefited from the fall in the value of the pound following the Brexit vote, as its holdings they were abroad.
His payments from Somerset have continued, despite being a so-called dormant shareholder who no longer has a role in advising on investment strategy or running the business. According to the Times, Rees-Mogg received dividends worth at least £600,000 last year, although this was down from £800,000 the previous year due to a 35% fall in profits, linked in part to for sale in emerging markets.
The analysis of the company’s investments, based on data provided by research agency Morningstar, shows stakes in major Chinese companies such as Alibaba and Tencent, which runs social media platform WeChat and has stakes in Spotify, Tesla, Snapchat, Monzo and Reddit.
There are also stakes in Samsung and chipmaker Taiwan Semiconductor Manufacturing, which is said to be in line to supply Apple’s iPhones and Macs next year.
Somerset has also taken a look at Infosys, the global IT company founded by Indian billionaire NR Narayana Murthy, the father-in-law of former chancellor Rishi Sunak, as well as Taco Bell owner Yum China and the beer companies Budweiser and Heineken.
The data also show the company has small stakes in a handful of Russian companies, including search engine Yandex, online recruitment firm HeadHunter and TCS Holding Group, which in turn owns the second-largest issuer of country credit cards, Tinkoff Bank.
The cabinet minister, whose father William Rees-Mogg was editor of the Times in the 1970s, previously pledged to reduce his stake in Somerset. He also has an extensive property portfolio including two flats in Pall Mall, owned by his company Saliston, as well as a former school near Gournay Court, a Grade II* listed Somerset mansion lived in by his mother, and a bungalow at Midsomer Norton.
Before setting up Somerset, Rees-Mogg worked for hedge funds in Hong Kong and Mayfair, and is one of the wealthiest ministers in Prime Minister Liz Truss’s cabinet.
Spear’s Wealth Management estimated in 2019 that his net worth was “well in excess of £100m”, a figure which also accounted for the expected inheritance from his wife, Lady Helena de Chair, whose mother was named who had a fortune of £45 million.
Oliver Crawley, a partner at Somerset, stressed that Rees-Mogg had not played a role in any of the firm’s investment decisions for more than a decade. “Any associational interest in Somerset remains on hold in accordance with the ministerial code,” he added.
Rees-Mogg, who was contacted by the Guardian through the business department, did not immediately respond to requests for comment.