River and Mercantile Asset Management (R&M) is set to merge with investment consultancy P-Solve (PSL).
The new combined entity will be called River and Mercantile Group and may seek to list on the London Stock Exchange in order to raise capital to fund further growth.
In a joint statement R&M and PSL said the new entity would provide “new services that leverage the equity management skills of R&M, together with the asset allocation and derivative management skills of PSL”.
PSL is part of the Punter Southall Group which until last year owned PSigma Asset Management, now part of Miton. Punter Southall Group will retain a significant stake in the new business, as will Pacific Investments, the majority shareholder in River and Mercantile.
The proposed merger, subject to FCA approval, means that River and Mercantile will expand its product range from its current equity focus into providing products based on “structured equity, multi-asset class and derivatives capabilities”.
P-Solve’s Mike Faulkner will be chief executive of the combined firm, while R&M’s chief executive James Barham will head up the equity management business and will be head of distribution.
While River and Mercantile recently surpassed £2bn in assets under management, P-Solve has £31.5bn in assets under advice and £8.2bn in assets under management.