UK wealth management firm Kingswood has acquired Sheffield-based financial planning business WFI Financial.
It will acquire WFI’s book of business for a maximum cash consideration of £14m ($17.1m, €15.5m).
This will be payable over a 30-month period, with £3.5m handed over at closing, which is expected to take place at the end of September 2019.
The balance will be paid on a deferred basis; subject to WFI meeting pre-agreed asset migration, recurring revenue and pre-tax earnings over the 30-month period.
The final payment is due in February 2022.
Double operation
WFI has offices in Sheffield, Derby, Lincoln and Grimsby and has around £550m in assets under management from over 970 family clients.
It has 37 partners and employees, including 16 financial planners and 19 support staff.
Upon completion, Kingswood will have around 5,500 active clients and assets under management of £2.5bn.
Gary Wilder, group chief executive at Kingswood, said: “The acquisition of WFI doubles the size of our wealth planning business and provides Kingswood with an opportunity to own a very profitable regional financial planning business with built-in expertise and capacity to expand.”
Cash injection
In June, Kingswood said it is in the process of agreeing a “capital injection” to fund its acquisition pipeline.
On 4 September, the firm said: “This injection of capital is consistent with the group’s stated strategy of pursuing accretive acquisitions across the UK and internationally, a number of which are in advanced stages of negotiation.
“Further announcements will be made as and when it is appropriate to do so. The closing of WFI is not dependent upon the subscription of the proposed growth capital.”
Previous deals
Kingswood has made a lot of acquisitions over the last year.
It bought UK financial advisory firm Marchant McKechnie for approximately £4m in October 2018; followed by Thomas & Co for £3.3m in February 2019.
The wealth manager also expanded its offerings to provide property investments through a cooperation agreement with its affiliate Moor Park Capital Partners, an independent pan-European real estate investment firm.
Additionally, it entered the US market in May 2019 through the acquisition of a 7% stake in registered investment adviser consolidator Manhattan Harbor Capital.
“We have a strong pipeline of opportunities we are currently evaluating,” said Wilder back in February 2019.
“Our strategy remains firmly focused on seeking opportunities, domestically and internationally, to drive growth in revenue and assets under management and advice, through acquisition and by attracting best in class wealth and investment talent to the Kingswood platform.”
When the company’s results came out in April 2019, it reported that its M&A plans were in excess of £100m ($127m, €112m).
