Just a few days after the FCA published its long-awaited rules on capital requirements for self-invested personal pensions (Sipps), consolidation of plans began.
Dentons Pension Management was the first to announce it had acquired the Sipp book from MAB Pensions, part of the Michael Ambrose Group, the Leicester-based financial advice and pension administration providers, for an undisclosed fee. The acquisition sees Dentons adding approximately 125 Sipp plans to its existing book.
City Pensions, a subsidiary of Mattioli Woods, also acquired the pension administration business of UK Wealth Management – a wholly owned subsidiary of Ashcourt Rowan – for £355,000. The business provides trustee and administration services to more than 400 Sipp and Ssas (small self-administered schemes) clients with total funds under trusteeship exceeding £190m.
Just a few weeks later, provider Barnett Waddingham announced it acquired Harsant Pension Services in a deal which sees the firm adding more than 400 Sipps to its business. Then shortly after, it announced it had also acquired Chase de Vere’s Sipp and Ssas business, adding a further 250 Sipp and 274 Ssas clients.
But this consolidation has not come as a surprise to providers.
Robert Graves, head of pensions technical services at Rowanmoor, said, “These new requirements make acquisition of new business extremely costly, especially
for smaller operators. By acquiring a relatively small amount of new business, not only would they have to meet the purchase costs, but the funds to meet the requirements would increase which effectively reduces working capital further.”
And some providers are not ruling out more acquisitions. Rupert Curtis, managing director of Sipp and Ssas provider Curtis Banks, said, “We see the current Sipp market as providing substantial opportunities for our business, but others will suffer.
“We are in a strong position to continue our growth via new business and acquisitions.”
charlotte.richards@ft.com
