Guernsey wealth manager swoops on $1.7bn in US assets

Guernsey-based European Wealth, an integrated wealth management group, is to acquire a US broker network with US$1.7bn (€1.44bn,£1.29bn) assets under management and re-brand itself.

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The deal, which is subject to various conditions, will see the wealth adviser enter the US market with 46 offices across the states, including New York and 12,000 clients.

The complex deal will see European Wealth acquire KPI US conditional on it acquiring Newbridge Securities Corporation and Newbridge Financial Services Group, Inc, a US based national broker-dealer and registered investment adviser platform.

Last year Newbridge made $0.5m profits on $28m revenues.

KPI US is owned by Kingswood which is a 39.9% shareholder in European Wealth.

European Wealth will fund the Newbridge acquisition using a loan from Kingswood and it will reimburse KPI US for its expenses in the acquisition which will complete simultaneously with the main deal.

The $17.6m loan will also provide $2m for Newbridge post acquisition and £2m for the UK business. The loan at 7.5% annual interest, is repayable in three years but can be repaid at any time without penalty.

The rebrand

After the deal European Wealth will rebrand as Kingswood across all of its businesses.

“Newbridge presents a unique opportunity to invest in an established, well-positioned company that significantly increases our global footprint by gaining immediate access to the largest wealth management market in the world,” said chief executive of European Wealth, Marianne Ismail.

“It will empower us to benefit from increased scale, enhance our product proposition and leverage operational efficiencies to attract more clients, and significantly increase our AUM.”

Leonard Sokolow, chairman of Newbridge, and Thomas Casolaro, chief executive of Newbridge, stated: “We believe that the proposed combination of our two businesses represents an exciting opportunity to grow a truly global business focused on delivering innovative products to our clients.

“European Wealth benefits from supportive shareholders, and with their backing, we can aim to rapidly build our product offering and global footprint, and ultimately, enhance our returns to shareholders.”

The deal is subject to regulatory approval.

Last month European Wealth founder and chief executive John Morton stepped down following a leave of absence.

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