Towergate Financial Services goes into administration

Towergate Financial Services (TFS) has gone into administration following the decision to roll the IFA consolidation arm back into its parent Towergate Partnerships Limited.

A spokesman for Towergate Partnerships said: 'The technical way in which the business is being transferred from an independent business to within Towergate partnership has been through administration so Grant Thornton were the administrators there. What this achieves is it aligns the various interests, it happens quickly and the trading businesses are unaffected,' he said.

The acquisition team becomes a division of Towergate reporting to chief executive Andy Homer. 

Patrick Snowball, who is stepping down as TFS chairman and leaving Towergate, said: 'The time is now right to concentrate on my other business interests. Putting TFS into the TPL structure is the logical way forward, given the different market environment we now face,' he said.

Peter Cullum, chairman of TPL, said the credit crunch had contributed to TFS' scaled back plans but the business plan remained intact. 'The original Towergate Financial Services concept - to replicate the Towergate model in the fragmented IFA market - remains as valid as ever but, given current economic conditions, we must scale back the rate of growth. The solution we have announced today safeguards the TFS business and provides the right structure for the future,' he said.

Up to 13% of TFS employees could lose their jobs. It is unclear whether staff have been informed. One member of the administrative team said he had not received a company email or communications informing him of the business transfer.