The asset management arm of the AIM-listed wealth management group has agreed to initially pay £3m in cash and £2.7m for shares, but the price could increase to £10.8m if DPZ’s assets under management remain within the group.
The shares issued will be based on an agreed price of 1706.4 pence per share, and a further payment of £2.4m will be paid in October.
Brooks Macdonald said it plans to build on the “successful integration and growth” of its asset management division by accelerating its growth rate and expanding its international team.
It said it intends to create a new fixed income offering based on the existing DPZ team, who it says have been successful in the asset class. It will also create a new platform team to reflect the success of DPZ’s International MPS solution.
The acquisition will increase Brooks Macdonald’s discretionary funds under management managed out of the Channel Islands by over 50%.
Chris Macdonald, chief executive of Brooks Macdonald Group, said: “This is a very exciting acquisition for the group in line with our strategy to expand our international division based in Jersey.
“As well as adding scale to our international business DPZ bring a highly talented investment management team and additional skills to expand our offering.”
Darren Zaman, chief executive of DPZ Capital, said: “We believe that by combining with BMI we will become part of the leading investment management business in the Channel Islands and look forward to contributing to a strong and fast-growing international investment business that will bring many benefits to our clients and staff.”
Founded in 2007, DPZ manages a range of investment strategies with a focus on asset allocation, manager selection, fixed interest, credit investing and equity selection. As of March, it had around £430m of funds under management, £360m of which was managed on a discretionary basis, £60m on an advisory basis, and £10m on an execution only basis.
In December, Brooks Macdonald International, a subsidiary of Brooks Macdonald, announced the launch of a platform-based international managed portfolio service.
The new service, operated by Jersey-based Praemium International, provides financial advisers with a choice of four actively-managed, risk-rated, segregated investment portfolios to recommend to their non-UK clients.
The Brooks Macdonald group had £5.68bn ($9.58bn, €6.81bm) in funds under management as of December 2013.
