Mergers and acquisitions  

Kingswood makes double purchase as it eyes 5 more deals

Kingswood makes double purchase as it eyes 5 more deals
David Lawrence, UK chief executive at Kingswood

Kingswood has bought two advice firms adding a total of £240mn to its assets under management.

The consolidator bought Buckinghamshire-based Employee Benefit Solutions (EBS) and Lincoln-based JCH Investment Management.

EBS offers a wide range of financial planning services including: retirement planning, savings and investment advice, protection, and inheritance tax planning. 

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It has three lead advisers and seven colleagues in total managing over £135mn assets under administration.

As part of the deal, all staff will be moving over to Kingswood. 

In the year ending March 2022, EBS generated revenue of £1.56mn and profit before tax of £806,000. 

Miles Burr, director at EBS said: "We have invested a huge amount of time in carefully investigating our options for a possible sale, looking to find the most suitable 'partner' that would enable us to take our business forward in a way that benefits our clients and staff. 

"We have been very impressed with Kingswood's proposition, their systems and senior management. 

“They are a great fit for EBS and we firmly believe we will be able to achieve our ambition of delivering the best possible long-term outcomes for our business, staff and, most importantly, our clients."

The deal for EBS has completed and the firm will be bought for total cash consideration of up to £5.08mn, payable over a five-year period, with £2.75mn paid at closing and the balance paid on a deferred basis.

Kingswood said it will satisfy the consideration due to the shareholders of EBS through a draw down of its new funding facility.

The new debt facility, announced last month, has a maturity of seven years and provided the firm with funding of £50mn with the ability to increase the commitment to £150mn should it be needed.

Kingswood said this will allow it to accelerate its strategic growth plans and provide additional capital to fund future acquisitions as well as fund existing deferred consideration. 

Meanwhile, JCH , the other firm purchased by Kingswood, manages clients predominantly across the Lincolnshire area, in total managing over £105mn of assets over 240 clients.

It has three advisers and seven employees, all of which will join Kingswood, subject to regulatory approval.

On completion, the existing Kingswood team will co-locate with the JCH team in the JCH premises.

John Hebblethwaite, CEO at JCH said: "This is an exciting development for the business, providing additional expertise, capability, and funding to continue our long-term track record of providing a best-in-class service for our clients. 

“Kingswood shares our vision and beliefs of empowering its employees to provide excellent client service and this move gives the perfect outcome for both our clients and team for their future prosperity.”

In the year ending July 31, 2022, JCH generated revenue of £901,000 and profit before tax of £406,000. 

Hebblethwaite said he spent over two years investigating options for a possible merger or sale, looking to find a “partner” that would enable him to take all aspects of our business forward.