Tilney and Smith & Williamson merger a ‘game-changing tie-up’

£625m deal could ‘fundamentally change the UK distribution landscape’

Tilney

Tilney’s merger with Smith Williamson has been labelled a “game-changing tie-up” which will enable it to compete with the likes of Hargreaves Lansdown and other advice heavyweights.

In a press release, Tilney today confirmed it had reached an agreement with Smith & Williamson, with the latter’s shareholders receiving a consideration valued at £625m, to be paid through a combination of cash and shares.

Changing the UK distribution landscape

Fundscape CEO Bella Caridade-Ferreira said: “Together these two companies have longstanding experience across all UK distribution channels — a merger enables them to compete with the likes of Hargreaves Lansdown and other wealth and advice heavyweights.

“I think this is another game-changing tie-up that could fundamentally change the UK distribution landscape.”

The merged business will be named Tilney Smith & Williamson and will have revenues of £500m. Its combined assets will total £45bn, making it a large competitor to Brewin and Rathbones who have £44bn and £49bn AUM each.

In August 2017, Rathbones confirmed a potential merger with Smith & Williamson. After this was revealed, Tilney submitted a last-minute bid for rival Smith & Williamson to derail its imminent merger with Rathbones confirming just under two weeks later that talks had collapsed.

Tilney merger price is reasonable

Willis Owen head of personal investing Adrian Lowcock said: “The merger was well flagged, but because deals of this size are not common it is hard to compare with other, smaller transactions.

“The price looks reasonable and given the nature of the two businesses there is some overlap which should mean there are cost savings, while the deal also gives access to other areas, such as accountancy expertise, which will give Tilney breadth and the ability to cross sell their services.

Tilney Smith & Williamson will have approximately 280 investment managers, 260 financial planners and a professional services business with circa 150 partners and directors.

The transaction is expected to complete in early 2020, subject to regulatory approvals.

“The acquisition is significant and will boost Tilney’s ambition to be a leading national wealth manager,” Lowcock said.

Tilney chief executive Chris Woodhouse (pictured) said in a statement: “Alongside the benefits of scale and an enhanced service offering, we will continue to focus on providing clients with a very personalised service, delivered by highly qualified professionals from locations across the UK, Ireland and Channel Islands.”

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