Financial services provider Quilter will reorganise the way its business is structured going forward by setting up focused divisions in a bid to “drive growth”.
This comes three years after the company listed on the London Stock Exchange (LSE) and following the sales of Old Mutual Global Investors, Quilter Life Assurance and Quilter International.
The restructure will see the creation of two additional client-focussed segments: high net worth (HNW) and affluent.
A spokesperson for Quilter told International Adviser that the two segments will broadly fit the customer types.
For the HNW division, Quilter Cheviot will serve as a discretionary manager, and it will work closely with Quilter Private Client Advisers as they both work with higher net worth/wealthier clients.
The affluent segment will see Quilter Investors’ multi-asset solutions being used alongside Quilter Financial Advisers, which will include offerings such as a remote advice team serving those with lower sums, and the Quilter platform catering to those with assets from £50,000 ($69,000, €60,000) up.
The spokesperson added that such a demarcation simplifies Quilter’s business model and organises it around client needs rather than its own internal business units. The boundaries between the two divisions will be “fluid” as clients won’t need to change adviser if they go from being classified as ‘affluent’ to ‘HNW’.
Quilter said that, since listing, its main focuses have been on simplifying its business model, optimising its cost base, shedding non-core operations, and returning the proceeds to shareholders.
Quilter International M&A update
The sale of Quilter International to Utmost is expected to complete before the end of 2021, and the firm foresees gross cash proceeds to be around £480m – representing the base sale price of £460m plus £20m interest since 1 January 2021.
After costs totalling approximately £40m, Quilter forecasts net sale proceeds to be £440m. Around £350m will be returned to shareholders and £90m will be retained by the business to fund its simplification programme to invest in longer-term revenue growth initiatives including a hybrid advice distribution channel and further digitalisation of the company.
The £350m proposed to be given to shareholders comprises a £25m contribution to the firm’s full year dividend “from a pro rata to 2021 earnings contribution from Quilter International”, and a £325m special return to shareholders either via payment of a special dividend or through the issuance and redemption of B-shares.
Paul Feeney, chief executive of Quilter, said: “Three years on from our listing, we have successfully concluded the initial phase of our strategic journey. Selling Old Mutual Global Investors, Quilter Life Assurance and Quilter International have simplified our operating model, removed businesses that weighed on our growth trajectory and together have allowed us to undertake special capital returns of around £1bn to our shareholders.
“We now look forward to executing the next stage of Quilter’s strategic journey which will be characterised by a focus on growth and efficiency. We are excited about our plans to grow our business, increase operating efficiency and to deliver our target of more than doubling operating profits by 2025.”
