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.
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.
“I am confident that Kingswood, as a major leading advice business, have the team and culture to be able to do this,” he said.
The purchase of the business, which is subject to regulatory approval, will be bought for total cash consideration of up to £3.5mn, payable over a two-year period.
Around £2.1mn will be paid upon receipt of approval and the balance paid on a deferred basis, subject to the achievement of performance targets.
Kingswood will satisfy the consideration due to the shareholders of JCH through utilisation of its new funding facility.
David Lawrence, UK chief executive at Kingswood, said: "I'm delighted by the ever expanding footprint of Kingswood into new counties, as well as announcing the acquisition of JCH today, the completion of EBS also takes us into a new county.
“For over 30 years, EBS have had a long-established presence in Buckinghamshire. They have a simple aim; to make complicated financial matters as simple as possible to help clients meet their goals and make their life as easy as possible. This mirrors what we strive for at Kingswood.”
Lawrence added: "We have a strong pipeline of activity, with a further five potential acquisitions in exclusive due diligence. Our near-term target is to build our UK AUA/M in excess of £10bn in the UK and £14bn globally."
Kingswood said it has “a further five purchase transactions under exclusive due diligence” that it expects to close in the coming months.
In September, Kingswood said it would enter the Irish advice market with its purchase of Dublin-based financial planning firm Moloney Investments, which added €700mn (£635mn) in assets under advice to its books.
Around the same time, the firm had signed heads of terms or was in exclusive discussions with a further eight UK and Ireland businesses.
So far in 2022, Kingswood has already bought six firms: Hampshire-based Smith Pearman and Associates, South-Yorkshire based DJ Cooke Life and Pensions, Rotherham-based Allots Financial Services, Essex-based Joseph R Lamb Financial Advisers, Eastleigh-based Aim Independent financial advisers and Lincolnshire-based Vincent & Co.
sonia.rach@ft.com
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