Kingswood has said it does not plan “to stop at two” international M&A deals.
This comes after the firm announced that it was “in exclusive due diligence on two potential transactions in two international markets”. The unnamed deals would deliver a further £1.3bn ($1.82bn, €1.52bn) of client assets and £3.2m operating profit on completion.
David Lawrence, UK chief executive at Kingswood, told International Adviser: “We’ve entered into exclusive talks with the two firms in the last two or three weeks. We’re not talking to any others at the moment, but we would like to.
“At some point, when we land one of these deals, my hope would be that other similar opportunities in another jurisdictions start to come forward. We find in the UK, every time we announce a deal, we tend to get a supply of new opportunities and we hope the same becomes the case with our international activities. The plan is definitely not to stop at two.
“We’ve got these two, they’re quite new and quite nascent, but we are focusing on closing them, and as we close them, I’m hopeful that similar opportunities will come along.”
The UK chief executive of Kingswood also discussed the details of the unnamed deals.
“These are similar in size to what we’ve previously done in the UK, probably between £500m of AuA up to about £1.5bn,” Lawrence said. “They either focus on one or both of the two parts of the value chain that we aim to grow, which is investment management and wealth planning.
“They have similar features to those in the UK. Either they are in need of capital to grow or to acquire themselves, and need a bit of fuel for that. Even though the jurisdictions create points of difference, actually the macro elements of the businesses we’re talking to is not dissimilar to those in the UK.”
International push
Kingswood has been growing its US arm in a bid to be a national broker-dealer across the States.
But the firm does have international ambitions outside of the UK and US.
Lawrence added: “We are keen to participate in markets where we think that there’s some synergies with what we already do.
“This includes markets that are fragmented, have opportunity for consolidation, or markets where advisory firms want to free themselves from regulatory pressure and seek investment to fuel growth.
“We have two opportunities to create an additional footprint from which we then create anchor point for some growth as well.”
Geographies
The firm’s plan is to look at opportunities that present themselves rather than have a strategy to enter many different markets.
Lawrence added: “If I think about the UK, we’ve got presence in certain parts of the country geographies and not in others. If businesses arise in those parts of the country, we will absolutely look into them for possible acquisition.
“But we’re not targeting parts of the country and the same applies on international remits. We are not saying that we wouldn’t like to have a footprint in specific parts of the world , we’re simply seeing opportunities and being presented with options.
“It is great position to be in because people are coming to us and saying, ‘do you want to consider these opportunities?’.
“Maybe, at some undefined time in the future, we will see some geographical regions that we want to focus on a bit more on than others, but for now we’re putting anchor points down, where we find high quality business that have a great fit with Kingswood.
“It’s exactly as we have done in the UK. We are happy to have a lot in one place and none in other places. It’s where the opportunities arise.”
