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Somerset IFA swoops on local firm to gain £15m boost

by Alex Steger on Feb 01, 2013 at 07:23

Somerset IFA swoops on local firm to gain £15m boost

Weston-super-Mare-based Fiveways Financial Planning has boosted its assets under advice to £65 million with the acquisition of nearby IFA Harrisons Financial Advisers.

Somerset-based Harrisons has around 1,900 clients, of which 400 are active, and £15 million in assets under advice.

Harrisons director Neil Harrison is retiring as an adviser but will join Fiveways as a client relationship manager to help ensure a smooth transition.

Fiveways director Chris Gilchrist (pictured) said Harrisons appealed as an acquisition due to its lack of potential liabilities. ‘There’s no unregulated collective investment scheme, no Keydata or Arch Cru,’ he said.

Gilchrist said Fiveways had not paid a lump sum for the firm and the eventual price of the acquisition depended on earnings.

‘It’s an earn-out deal, there’s no upfront payment changing hands, it’s based on ongoing income from clients rather than any initial fees,’ he said.

Gilchrist said Fiveways would make more acquisitions if the right opportunity presented itself.

He said he expected there to be more firms like Harrisons coming onto the market as advisers realised theretail distribution review (RDR) required more of them than just becoming qualified.

‘From what we’ve heard, there are a lot [of advisers] who have done QCF level four but they don’t have an RDR-ready proposition,’ he said.

9 comments so far. Why not have your say?


Feb 01, 2013 at 10:02

Sounds like this journo thinks he is doing a transfer window story...."Swoops on local firm".....

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Alistair Hinton

Feb 01, 2013 at 10:25

...or even an arrow visit from another well-known three-letter organisation with "F" and "A" in its name if the reader's concentration is less than it should be, perhaps? - except that, in such circumstances, "boost" would more likely have had to read "fine"...

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Feb 01, 2013 at 10:38

1900 clients = £15 Million??? = £7,894.73/ client. OMG

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Ross D

Feb 01, 2013 at 11:56

400 active. = £37,500 per client. i.e the real world.

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Feb 01, 2013 at 12:05

1500 = no assets, but still on books. ave of working clients = £37,500 OMG OMG twice

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Feb 01, 2013 at 15:16

Yawn, only read this as counting down the clock who actually cares!

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Usually found sitting on the fence

Feb 01, 2013 at 16:55

If able to retain the 400 and have a recurring income of .5% to 1%, that's still an addition to the turnover of between 75k and 150k and keeps some potentially orphaned clients in an advised world. Also if able to tap into the other 1100 clients and using the old owner to smooth the way, fair play and good luck.

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Feb 01, 2013 at 17:37

But does that income £187-£375 annual per client justify the time involved and the potential legal liabilities of 1500 clients if just one piece of advice goes belly up. As we all know, the smaller the client the more likely a complaint. The man needs to raise his bar for assets per client. But then income is income as long as you stay on a firm foundation.

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Richard via mobile

Feb 03, 2013 at 07:42

Fair play to both parties. The key to a successful acquisition is delivering increased productivity, so paying top dollar for a firm that has already moved clients to an RDR compliant model makes it hard to add value to mutual benefit. If you can offer the 'acquired' clients a premium service (eg an attractive asset management proposition) and free up the vendor to do what he does best - ie spending time with clients, the gain can be massive. I can see a lot more deals like this happening

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