Tatton Asset Management (Tam) has acquired a 50% stake in investment manager and model portfolio service (MPS) provider 8AM Global for a consideration of £7m.
A spokesperson for Tam confirmed to our sister publication International Adviser that the remaining 50% stake is held by the management of 8AM Global.
In a trading update on 20 April 2022, the asset manager said that 8AM Global’s model portfolios and funds will “complement Tam’s existing position, further demonstrating our commitment to supporting financial advisers in delivering low-cost investment management and enhancing IFA client outcomes”.
On completion, Tam expects the deal to add around £800m in assets under management to the group’s existing £11.3bn.
The deal comprises an initial consideration of £3.5m payable through the issue of new shares, and the remainder payable in equal cash instalments against financial performance targets at the end of the first and second year after completion.
Tam will also have the option to acquire the other 50% of 8AM Global’s share capital following the deferred consideration period.
Growth strategy
Paul Hogarth (pictured), chief executive of Tam, said: “I am delighted to announce the proposed acquisition of 50% of the share capital of 8AM Global Limited, an ambitious and growing DFM MPS business.
“The business complements our existing offering and brings with it an experienced and motivated management team who are well known to us and culturally aligned to the values of the group. We are very much looking forward to working with them.
“Post completion, this will be the second acquisition in less than a year for the group, demonstrating that we are executing on our three-year ‘roadmap to growth’ strategy. With a three-year target of £6bn of growth in AUM, at the end of the first year we remain on target to achieve this.
“This year we have grown organically by £1.7bn and acquisitions to date have contributed a further £600m, a total contribution of £2.3bn towards the target and on completion 8AM will further enhance this number.”
8AM managing director Jeremy Nunn added: “The sale will allow 8AM to build on its success and provide us with access to the know-how and expertise of one of the market leaders in the MPS space. It will act as a springboard for the growth of our assets under management and provide advisers and investors with the comfort that the development and resilience of the 8AM products will continue to be at the forefront of our plans.”
Demonstrated resilience
In addition to the acquisition, Tam also provided a trading update for the year ended 31 March 2022. AUM jumped 26.1% to £11.34bn, up from £9bn the previous year.
Total net inflows for the year were £1.28bn, up from £755m a year ago, while the acquisition of the Verbatim funds added £650m and market returns contributed a further £420m.
Commenting on the results, Hogarth added: “The group has delivered another good year of growth across both divisions and I am particularly pleased with the significant increase in net new inflows to the group which underpins the organic growth opportunity that exists in our market. The last quarter was a difficult environment from a geopolitical and economic perspective, but we demonstrated the resilience of our business model maintaining robust net inflows and finished the year strongly with £11.3bn of AUM.”
