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Permira targets tripling of AUM after Tilney/Bestinvest mega-merger
by Elsa Buchanan on Feb 27, 2014 at 15:50
Permira is to merge its recent acquisitions Deutsche Asset & Wealth Management and Bestinvest with the aim of tripling the combined group’s assets under management ‘over the next couple of years’.
The private equity group today announced it had finalised the deal to buy the regional business of Tilney from Deutsche and this follows on from itsacquisition of Bestinvest last November.
Philip Muelder, a partner at Permira, told Wealth Manager: 'If we look forward from where we stand today with £9 billion in assets under management and my goal is to get to £20 billion or £30 billion of assets over the next couple of years, and accelerate the growth of the business, taking it into the top five independent wealth managers in the UK.'
'The plan is to create one combined business going forward, and clearly Tilney offers real strength in discretionary fund management and we will continue there with the existing office networks and the existing team.’
He described the two firms as a 'good fit' with Bestinvest largely London-based while the Tilney acquisition has seen it take the company’s offices in Birmingham, Edinburgh, Glasgow and Liverpool. The Tilney name will be retained in the regions with Bestinvest also set to keep it brand.
The combined business has around 400 staff with just under 200 moving across from Tilney, which is headed by Tom Slocock (pictured). Although combining the back offices of the two means there could be duplication of some roles, Muelder said: ‘We have no plans to roll out major redundancies.
'We plan to deploy further significant capital for both further consolidation and really invest behind organic options for the blended business. The client proposition is significantly improved and we're open to bringing in new teams to accelerate the hiring of talented staff into the business.’
Muelder also pointed to the 'very similar' investment philosophy between the two businesses, explaining integration would be facilitated by the fact both businesses' discretionary fund management assets sit on the same platform, Pershing.
Regarding the troubled Tilney-owned Cardales’ Glanmore Property and British Real Estate funds, Muelder insists 'the legacy issues are something of the past'. The funds were suspended after they ran into difficulties when the property market turned in late 2007.
It is understood that compensation payments linked to Tilney's Glanmore Property fund have weighed on the deal.
Two years ago, Permira launched an unsuccessful bid for the Cheviot Asset Management business, which was later acquired by rival wealth management firm Quilter.
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