Ashcourt Rowan board backs ‘reasonable’ £97m sale to Towry

The two companies claim that combined they will be one of the top 20 players in the UK private wealth market by assets under management.

Once the merger is complete, the new company is expected to have £11bn of assets under management and revenues of £138m.

The announcement of the deal on Monday morning led to Ashcourt Rowan’s share price jumping by 57 per cent.

Ron Sandler, chairman of Towry, said: “Our highly complementary business models will deliver significant client benefits, providing access to a broader range of services and investment solutions.

“Ashcourt Rowan has developed into a high quality business following a period of reorganisation and with a strong cultural fit, the combined entity will be well positioned to take advantage of further growth opportunities as the market continues to evolve.”

Once the deal is complete Towry will conduct a full review to find potential savings, which the company has said will lead to redundancies, but the number is not yet known.

Under the terms of the deal, Ashcourt Rowan chief executive Jonathan Polin, chief financial officer Alfio Tagliabue and head of governance Steve Haines will all leave the company.

All three will receive pay-offs as part of the deal, with Mr Polin allegedly receiving around £4m.

Ashcourt Rowan’s directors have said in a statement that the deal is fair and reasonable and have unanimously recommended that shareholders vote in favour of it.

Hugh Ward, chairman of Ashcourt Rowan, said: “We are pleased that our recent discussions with Towry have been concluded positively and that the loyalty shown by our shareholders has been rewarded by this offer for Ashcourt Rowan.

“Our executive team has worked tirelessly to execute a recovery of Ashcourt Rowan’s position since joining in late 2011 and effecting the placing in December 2011.

“The offer price of 275p per Ashcourt Rowan share represents a fair price for the business, is a 4.7 times increase in the market capitalisation of the Ashcourt Rowan Group since 1 December 2011, and is testament to the dedication, passion and drive of all our staff.”

Background box

Towry is backed by private equity firm Palamon and Ashcourt Rowan is owned by a variety of backers including private equity firms Tetragon Financial Group and The Jodi One Trust, along with fund managers River & Mercantile and Artemis.

Ashcourt Rowan has assets under advice of £5bn–- of which £2.3bn are managed on a discretionary basis – and employs 340 members of staff in 16 offices across the UK, while Towry has £6bn in assets under advice, employing around 800 people across 20 offices.

Last April Ashcourt Rowan completed its acquisition of UK Wealth Management, pushing its assets under management to £5bn.