Interactive Investors will sell off the advised assets it inherited in its Alliance Trust Savings acquisition despite diversification into the intermediary space initially being touted as a benefit of the deal.
Embark Group has reached an agreement in principle to buy the ATS advised and partnership businesses, representing £6bn, for an undisclosed sum.
In October 2018, in the days after II revealed it would acquire ATS, Alliance Trust PLC deputy chairman Gregor Stewart had said the advised and partnership businesses had been a big pull for Interactive Investor. Stewart had been involved in the negotiations over the sale of the platform, which had been held by the global equities investment trust.
But in a press release issued on Monday, Interactive Investor said the divestment of the advised and partnership businesses affirmed its focus on serving the UK D2C market. It completed the migration of ATS D2C clients on 14 October.
Interactive Investor chief executive Richard Wilson said Dundee would remain an employment centre for ATS.
Wilson said: “The ATS jobs have been protected which was a key consideration and I have no doubt they will take the business from strength to strength.
“The divestment will allow II to focus on its single purpose: to serve the self-directed retail investor, and the increased scale means we can continue to invest in providing a class leading customer experience, excellent value and a wealth of impartial information to help customers make better-informed investment decisions.”
The deal takes Embark Group assets under administration to over £22bn, said its chief executive Phil Smith. “This acquisition presents a perfect opportunity to accelerate our growth strategy by acquiring a book of platform assets with high Sipp penetration, as well as complementary distribution relationships.”
Smith added that it also establishes a centre for its operations and growth in Scotland, enabling it to access local talent and fintech capabilities, assisted by cross-government support.
The Scottish Government, Scottish Enterprise and Scottish Development International have been working closely with the company, said Jamie Hepburn MSP, minister for business, fair work and skills. “Embark’s plans to retain the site in Dundee is good news for employees and for the economy of the city.”
