Rathbone Brothers on Thursday confirmed a much touted deal to acquire Glasgow-based Speirs & Jeffrey, Scotland’s largest independent wealth manager, for an initial £104 million.
“Under the terms of the transaction, Rathbones will pay an initial cash and share consideration of £104m,” said Rathbone Brothers.
“Further contingent consideration of 0.6m Rathbones shares will be payable dependent upon meeting certain administrative and procedural targets that enable the delivery of cost synergies.
“Earn-out consideration and incentivisation awards of up to a maximum of a further 5.2m shares will only be payable as operational and financial performance targets are delivered over the medium term.”
Speirs & Jeffrey has funds under management of £6.7 billion and 38 investment professionals.
Rathbone Brothers. is buying the Scottish firm from its shareholders, “all of whom are working executive directors of the business.”
All of Speirs & Jeffrey’s current directors and investment managers will be joining Rathbones and Speirs & Jeffrey CEO Russell Crichton will become head of Rathbones’ Scottish business.
Rathbones’ Glasgow team will combine with Speirs & Jeffrey to consolidate Rathbones’ existing Glasgow presence.
“The transaction will also further enhance Rathbones’ position as one of the UK’s largest wealth managers with pro-forma funds under management of £44.5 billion,” said Rathbone Brothers.
Rathbone Brothers CEO Philip Howell said: “From the outset of our engagement, both teams have recognised how compatible they are in culture, investment philosophy and dedication to client service.
“Speirs & Jeffrey represents an ideal strategic, professional and geographic fit with Rathbones and we look forward to working together both to develop our business in Scotland and deliver compelling returns for our shareholders.”
Speirs & Jeffrey CEO Russell Crichton said: “My colleagues and I have long admired Rathbones, and everything we experienced during our discussions has merely strengthened our conviction that it offers the very best fit for our clients and our people.
“With our client-facing staff members committed to and enthusiastic about the future, clients will continue to enjoy the high level of personal service which has become the hallmark of our firm, but with the additional significant benefits of Rathbones’ scale, specialist expertise and deeper capabilities.
“We are all excited about our partnership with Rathbones and the opportunities this new chapter in our history will provide.”
Speirs & Jeffrey chairman Graham Waddell added: “This represents a significant milestone for S&J but undoubtedly the right one for our clients and our people.
“The fact that our team will remain intact and that our clients will continue to receive the same exacting standards of personal service, whilst benefitting from the wider resources of Rathbones, fills me with great confidence for the future.”
The acquisition is subject to approval by the FCA and is expected to complete in the third quarter of 2018.