Team Asset Management has announced its plans to buy Jersey-based IFA Concentric Group for up to £2.5mn, subject to approval by the Jersey Financial Services Commission.
In an update today, Team AM said it will pay an initial consideration of £1.7mn in cash, plus further deferred consideration of up to £0.8mnn in new shares in the asset manager.
The firm said the cash consideration will be funded through a £2.65mn subscription from existing and new investors in Team.
Concentric is a Jersey based financial planning and investment consultancy business for over 430 retail, high net worth investors and institutional investors, with assets under advice of £231mn, as at December 31, 2021.
In the 12 months to December, Concentric generated revenues of £1mn and adjusted Ebitda of £0.22mn, profit before tax of £0.1mn and had net assets of £0.5mn.
On completion of the purchase, the directors currently expect Team to have assets under management and advice of approximately £550mn, with approximately £1.4bn of cash under advice.
The acquisition is the fourth transaction the company has made since inception in January 2020 when it bought Theta.
In July 2021, Team bought cash management service JCAP and in December, an IFA called Omega.
The purchase of Omega is still awaiting regulatory approval.
As at March 31, Team said AUM stood at £231mn with a further £1.4bn of cash under advice.
The company has undertaken the subscription to part fund the acquisition at a subscription price of 60 pence, a 5.5 per cent discount to its closing price on 11 May.
Team’s chief financial officer Matthew Moore, said: “Concentric is led by an experienced, ambitious team who have built a good business, growing the client base, services and staff, revenues and Ebitda in a challenging market.
“We are delighted they see the transaction as a stepping stone to achieve their own goals, by being part of a larger, wealth management business, with shared values and the ability to offer clients a broader range of investment advice services.”
Moore added: “Core to Concentrics’s investment approach is to focus on modern quantitative and qualitative analysis, with an emphasis on impact, ESG and sustainable development goals investing. These are values shared with Team and a basis for significantly expanding Concentric’s customer base by targeting the aspirations of the upcoming generation of investors in Jersey, the UK and internationally.”
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