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Rathbones to acquire UK advice firm for £150m

Combined £60bn business will make the company the third largest wealth manager in Britain

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Wealth manager Rathbones is set to buy Saunderson House for £150m ($207m, €174m).

It confirmed on 23 June 2021 it had struck a deal to acquire 100% of the issued share capital of CastleCo, the holding company of Saunderson. The deal is slated to complete in Q3 2021, subject to regulatory approval.

Saunderson is the largest professional services-focused financial planning business in the UK, managing £4.7bn in funds under management, advice and administration for around 2,200 high-net worth clients.

The combined business will have total funds under management and administration (FUMA) of around £61bn, making Rathbones the third largest wealth manager in the UK.

Rathbones has agreed to pay a total consideration of £150m to funds advised by Epiris and the management and employees of Saunderson.

This will comprise initial cash and share consideration amounting to £135.1m, including the repayment of debt, structured as £130.2m in cash and £4.9m in new Rathbones shares payable at completion. It has also agreed to pay deferred consideration of £14.9m on the first anniversary of completion.

Rathbones to double financial planning arm

Rathbones said the Saunderson acquisition would boost its own financial planning capability and “enhances its ability to offer a more holistic wealth management proposition” to existing clients of its investment management business “where appropriate”.

Over the last several years Rathbones has been trying to expand its financial planning operation to bolster its presence in the intermediary space.

Following the acquisition, the number of in-house financial planners will jump from 25 to 80 with pro forma FUMA more than doubling from £3.7bn to £8.3bn. Rathbones expects “strong demand for high-quality financial planning to drive further organic growth and present a meaningful growth opportunity in the highly attractive HNW professional clients sector”.

The wealth manager’s £2.3bn independent adviser network Vision Financial Planning will continue to operate separately and will remain “an important part of the group”.

Rathbones chief executive Paul Stockton said: “Saunderson House is a high-quality business with a strong desire to deliver leading wealth management services to clients over the long term, and it will add both scale and capability to Rathbones.

“Commonly shared values and a resolute focus on delivering quality client outcomes provide a firm foundation from which to take advantage of some exciting growth opportunities. I very much look forward to welcoming everyone at Saunderson House to the Rathbones group as we work to exceed our ambitions together.”

Saunderson is the latest significant acquisition for Rathbones. In 2018 it snapped up Scotland’s second-largest wealth manager Speirs & Jeffrey for £104m. Before then, it had briefly flirted with the idea of joining forces with Smith & Williamson but the potential merger was off the table in a matter of weeks.

For more insight on UK wealth management, please click on www.portfolio-adviser.com

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