Assets of beleaguered Liberty Sipp sold

Buyer will not take on potential liabilities linked to mass mis-selling claims

All of the trading assets of Liberty Sipp have been sold to a subsidiary of retirement solutions provider the Embark Group, but it will take on none of the self-invested personal pension scheme provider’s liabilities.

As reported by Portfolio Adviser sister publication International Adviser in August, Liberty is currently facing 500 ombudsman mis-selling claims brought by law firm Anthony Philip James & Co (APJ).

However, a spokesperson for Embark confirmed to IA that the acquisition is just for the assets and does not involve the legacy issues.

The claims centre on allegations that Liberty failed in its duty to treat customers fairly by accepting a high volume of clients who were unsuitable for self-invested personal pensions (Sipp) investments from an unregulated introducer.

Comment was sought from the representatives of Liberty about the potential consequences for customers claiming they were mis-sold, but no further details were provided.

It is not clear at this stage what the implications could be for the 500 ombudsman claims.

What has been bought?

The Liberty assets were acquired by EBS Pensions, a subsidiary of Embark Group. The combined businesses bring together £6.8bn of assets under advice and a combined book of 32,000 Sipp clients.

It will be led by Liberty directors John Fox and Julie Dean.

The sale comes after the Sipp provider announced in July that annual revenue was up 35% to £2.95bn.

It has not been revealed what EBS paid for Liberty’s assets, but Embark will inject £2m of additional regulatory capital into EBS to support scale and growth.

Embark will also provide financial and operational support to the shareholders of Liberty to facilitate the orderly wind-up of its business.

The Liberty products will be rebranded but maintained under the current terms and conditions.

The deal brings the total Sipp scale of the Embark Group to around 56,000 scheme and 140,000 clients, with total group AUA of circa £15bn. It will remain headquartered in Greater Manchester with an office in London.

Thriving at EBS

Phil Smith, chief executive of the Embark Group, said: “This transaction, at this time, provides protection for the consumer clients of Liberty. It is also highly positive for the employees of both businesses and will further improve the growth trajectory for wider stakeholders of the Embark Group.

“Fundamentally, the ex-Liberty team, their clients and distribution partners will thrive with the supportive financial strength, scale, and technology resources of the Embark Group.”

John Fox, managing director of Liberty Sipp, added: “The timing and cultural fit of this transaction is excellent for all of us at Liberty. We are moving from being one of the fastest growing small players in the Sipp market, to driving the continued growth of one of the largest sector players.”

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