Smith & Williamson has announced the termination of its merger negotiations with Rathbones, and revealed it intends to pursue a stock market listing instead.
Reports emerged on 21 August that Smith & Williamson, the UK’s eighth largest accountancy firm and also a wealth manager, was negotiating a deal to combine with Rathbones and create a £2bn company.
But in a statement released last night (31 August), a spokesman for Smith & Williamson said: “Following our growth and business development in recent years, the board had agreed to prepare the company for a potential stock market listing. While we were pursuing this course, we were approached by Rathbones.
"After careful consideration, we have been unable to reach agreement on terms which would be in the best interests of all our stakeholders.”
Andrew Watson, an analyst at N+1 Singer, had previously stated that the cost savings would need to be “considerable” for the deal to provide value for Rathbones shareholders.
The wealth and investment management sectors have been ripe with merger and acquisition activity of late, with the mergers of Aberdeen and Standard Life, Janus and Henderson, and Tilney with the Towry Group in the vanguard of the activity.
Rathbones said it has incurred expenses of £5m relating to the merger, according to FTAdvisers sister paper, The Financial Times.
At the time this article was published, Rathbones shares were up 3 per cent (1 September) at £27.83.
david.thorpe@ft.com
