Morningstar has had its eyes on the UK platform market for a while and believes its takeover of Praemium is a “good fit” which will see it attract more advisers.
Speaking toFTAdviser, Daniel Needham, president of wealth management solutions at Morningstar, said the firm was looking to move into the UK platform space as it already owns platforms in other countries.
In the US the company has what is known as a turnkey asset management platform, whereby advisers outsource the investment planning part of their practice, similar to how a discretionary fund manager works in the UK. The firm also has a small platform business in India.
Morningstar has now made its move into the UK market with its acquisition of wealth management platform Praemium for £35m, as announced yesterday (December 21).
Needham said: “We have definitely been looking around the world on whether it makes sense to acquire, whether it makes sense to partner or whether it makes sense to build and so for us this deal was a good fit.
“We're very familiar with the Praemium business and team from Australia and the UK.”
When asked why the firm wanted to move into this space, Needham said it wanted to help as many advisers as possible deliver advice.
“We're going to be investing in the business and in the solutions that we deliver,” Needham explained. “At the end of the day, advisers will go with the solution that works best for them, as a small business owner as well as for their clients.”
Needham added: “We're going to put a compelling proposition in the market and our expectation is we'll be able to serve more advisers.
“Praemium are already on an exciting growth trajectory with the platform and with their CRM and so we're just going to continue to help support that and it's a great opportunity in the UK. We think competition is great and investors and advisers win with competition.”
The firm is not looking to replatform or create any disruption to advisers who are already using the platform, he said.
“We're acquiring this business because we think their digital first solutions are really market leading and we are looking to leverage that,” Needham said.
“There will be no replatforming, we're going to be doubling down with the team so that they can continue to expand their solutions.
“Our goal is that there is no disruption to Praemium’s clients, and if anything, can we help serve them better by looking at bringing additional services in to work with those firms.”
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