Canaccord Genuity Wealth Management (CGWM UK) has entered into a share purchase agreement to acquire financial planning firm Punter Southall Wealth from Punter Southall Group.
The deal, which requires regulatory approval, also includes discretionary fund management business Psigma Investment Management.
Punter Southall Wealth offers a range of advice and wealth management solutions to high net worth individuals. It has approximately £5bn in client assets.
Tilney Smith & Williamson had been vying to buy the wealth manager earlier this year to bulk up its assets ahead of a possible stock market flotation, according to The Times.
‘Strong cultural fit’ between Canaccord and Punter Southall
As part of the deal, CGWM UK will pay £164m cash and an equity interest comprising newly issued ordinary shares in the business to Punter Southall.
It will also pay £6m to “certain key employees of Punter Southall Wealth”, dependent on agreed post-sale targets. Several of Punter Southall Wealth’s team will become active members of CGWM UK’s existing investment committees.
David Esfandi (pictured), chief executive of CGWM UK, said: “Our acquisition of Punter Southall Wealth represents an exciting strategic opportunity to further develop our integrated wealth management business, adding national scale and exceptional capability to our advice-led offering.
“We see a strong cultural fit between CGWM UK and Punter Southall Wealth and we look forward to supporting this talented team, as we work together to build upon the strong foundations that both of our businesses have established to date.”
Jonathan Punter, chief executive of Punter Southall, said: “The market for financial advice to high net worth individuals is consolidating and we felt that Punter Southall Wealth would benefit from a larger partner which can take it to the next level of its development.
“After long and careful consideration, we chose Canaccord Genuity as the best partner for our clients and our people.”
Funding
In connection with the closing of the deal, the wealth manager will add £100m to its existing bank facility.
HPS Investment Partners, on behalf of investment accounts and funds it manages, has agreed to make an additional investment in CGWM UK on closing of the acquisition through the purchase of a new series of convertible preferred shares of the business in the sum of £65.3m.
The company will hold an approximate 66.9% equity equivalent interest in CGWM UK on a converted basis.
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