River and Mercantile Asset Management (R&M) is to merge with investment consultancy P-Solve in a move that could see the combined group floating onto the stock market.
The merged firm will be renamed River and Mercantile Group.
It will retain the two companies’ existing business channels but will look to develop new services. These will combine the R&M’s equity management with the asset allocation and derivate management capabilities of P-Solve to offer outcome-focused mandates for both the retail and institutional markets.
After the merger is completed the company will 'explore the possibility of an IPO to raise capital for further investment in its growth strategy.
P-Solve's chief executive Mike Faulkner will be CEO of the combined group with R&M chief executive James Barham (pictured) set to continue heading the equity managament business. He will also oversee groupwide distribution.
Barham said: 'This merger ensures that we are true to our founding principles, aims and objectives. This will accelerate our plans to develop a broad-based, diversified business where investment sits at the heart of our firm.
'We will have a strengthened platform from which to work and support our clients and consultants and I look forward to working with the new management team to achieve our common goals.'
Faulkner said: 'This takes us forward significantly in our ability to continue enhancing the level of service we provide to our clients. This is both in terms of the expanded flexibility it will give us in developing investment solutions, and the depth of investment thinking that will exist in the combined business.'
The two companies majority shareholders, Pacific Investments, which has a large stake in R&M, and Punter Southall, the owner of P-Solve, will retain strategic shareholdings in the merged firm.