Blacktower managing director John Westwood and WorldWideBroker chairman Paul Brown said they had known each other for some time, and had been in discussions about a possible merger for almost three years.
Blacktower has some 10 offices in eight countries, including one in Surrey in the UK; three offices in Spain; a new one in Malta; and one each in Germany, Portugal, France, Gibraltar and Italy.
WorldWideBroker has a head office in the Netherlands, and satellite offices in Switzerland, Russia, the Czech Republic, and Greece.
It recently closed its outpost in Germany, according to Brown, because the business was underperforming, and he was aware that the merger was on the cards, but he said that plans to expand in Germany, under the Blacktower name, are under consideration.
For now, WorldWideBroker’s business in Moscow “will remain outside the scope” of the deal, the companies said, citing technical reasons.
WorldWide Broker Netherlands is unrelated to Worldwide Broker Network, a global organisation of privately-held insurance brokers.
Two-phase deal
Westwood and Brown said their merger had been designed to occur in stages. The initial phase would see WorldWideBroker transferring its advisory staff and new business to sit under the Blacktower Group’s systems and controls, as well as taking on the Blacktower name.
The plan is for this phase to be completed by November, Westwood and Brown said in a statement.
Under the agreement, Brown will become a director of Blacktower, and responsible for the operational control of the transferred WWB element of the newly combined business.
The second stage of the merger will see the legacy business of WorldWideBroker Netherlands move over to Blacktower, once the first stage of the deal is “operating satisfactorily”, Westwood and Brown said.
‘Increase our footprint significantly’
Westwood called the merger an “important step forward” for his company, as it will increase Blacktower’s footprint “significantly”, by five offices, to 15, and the number of client-facing advisers to 46 from 28.
He said the merger made sense in view of the way Europe’s wealth management industry is evolving, with critical mass and the implementing of modern and compliant systems and controls becoming more important than ever before.
“Paul and I have been in discussions for some time now, searching for a professional business solution to successfully agree this deal,” he added.
“By structuring it in this way, it allows both parties time to implement the inevitable operational changes that will be required.”
Brown said that he got to know Westwood and his Blacktower team during the development, in recent years, of Nexus Global, Blacktower’s IFA network business.
“In a landscape [in which] there is much uncertainty for European IFAs, Blacktower’s expansion plans for Europe and beyond are forward-thinking and exciting,” Brown added.
“Our staff and advisers are enthusiastic about becoming part of the Blacktower Group.”
Expansion
As reported, Blacktower announced last month that it was planning to open an office in Malta this month, extending its footprint even further to the east than it did last year when it established its first Italian outpost in Rome.
Blacktower launched an IFA network, open to other European IFAs, in 2011. Nexus Global, or NXG as it is called, enables member firms to offer a range of exclusive funds provided to NXG by Quilter Cheviot Investment Management, through a strategic partnership.
