International Adviser reported in December last year that Praemium was eyeing a Sipp provider acquisition in an interview with Praemium chief executive Michael Ohanessian.
The deal is subject to completion of the agreement including approval by UK regulator, the Financial Conduct Authority (FCA).
Once completed, the transaction is expected to be earnings accretive in the first year.
Founded in 1992 and based in Cumbria, England, Wensley Mackay is authorised by the FCA and is a privately owned self-invested personal pension (Sipp) and small self-administered scheme (SSAS) provider.
Ohanessian said: “In the UK, platform providers have seen the retirement market open up following pension reforms introduced in April 2015 that de-mandated the use of annuity investments. Investors are exiting annuities and seeking other options for their retirement savings, with a major shift to pension schemes like Sipps that offer a wide range of investment options.”
He added: “Accordingly, adding a Sipp solution to our UK platform proposition enhances our growth prospects by offering a complete package to our clients. When coupled with our range of innovative investment products, such as the 80% Capital Protected funds that are ideal for retirees, we expect considerable upside from our UK and international distribution channels.”
Wensley Mackay managing director Paul Wensley said: “I am incredibly proud of what we have achieved at Wensley Mackay over the last 24 years. This deal offers a fantastic opportunity to grow the business and deliver the high quality service for which we have become known to a much larger group of financial services professionals and clients.”
Praemium currently operates its discretionary investment platform in the UK using the company’s proprietary Separately Managed Account (SMA) technology.
But the company pointed to over one million Sipp schemes currently in the UK market that is rapidly expanding mainly due the UK’s recent pension reforms.
Platform-based Sipps have also captured a large part of this growth, accounting for around half of all current plans in force, it said, and the acquisition of Wensley Mackay would provide Praemium with immediate access to the market.
