The managing director of London-based Bradbury Hamilton, which has long been on the acquisition trail, has lambasted advisers who are not properly prepared for the sale of their firms, citing data that are in “poor condition” and a “lack of engagement” with buyers.
Mr Bradbury said sellers should be “more realistic” about the sale prices they can command, as valuations were bound to fall with the end of trail commission in 2016.
He said: “Potential legacy commission problems on the horizon will continue to put pressure on valuations and deter buyers from paying a fixed price, but better preparation can help IFAs maximise the price paid.
“Many IFAs decide they want to sell and then don’t prepare well enough. Their data are in poor condition and a lack of engagement means they have little to demonstrate the value of their clients to a potential buyer.”
Earlier this month, Bradbury Hamilton announced the acquisition of Leeds-based SBB Consulting.
Adviser view
Andrew Oliver, director of Kent-based Andrew Oliver & Co, said the buyers were pocketing the ongoing adviser charge paid by clients, meaning advisers were “working for nothing” to ensure clients did not walk away and reduce the full valuation of recurring income payable 24 months following the sale.
