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Parmenion sold to private equity house in £102m deal

Parmenion sold to private equity house in £102m deal

Parmenion has become the latest platform to be snapped up by a private equity house, with Standard Life Aberdeen announcing its £102m sale to Preservation Capital Partners.

The deal is part of SLA’s plan to simplify its business and focus on its core platforms - Wrap and Elevate.

According to Parmenion, Preservation Capital Partners is a "long-term investor" and so has access to "significant capital to support Parmenion in growth and consolidation within the wealth management sector".

As well as its platform service, Parmenion offers model portfolios for advisers as a discretionary service and technology to help advisers run their own portfolios. 

In November SLA confirmed it was exploring the sale of Parmenion, one of the first major strategic decisions made by new chief executive Stephen Bird.

It marked a move away from the legacy of former co-chief executve Martin Gilbert, who ‘ring-fenced’ Parmenion from other changes taking place in the business.

Parmenion only has £8.1bn in assets under management are overshadowed by Wrap and Elevate, SLA’s more mainstream adviser platforms which have a combined £67bn in assets.

Aberdeen Asset Management, which was founded by Gilbert, bought Parmenion in 2016, a year before Aberdeen merged with Standard Life.

Bird said: “The sale demonstrates our commitment to simplify our operations and reconfigure our business, and investment, around our growth vectors. 

“In the adviser vector, we will continue to focus on providing a market-leading proposition to financial advisers through our Wrap and Elevate platforms.”

Martin Jennings, chief executive of Parmenion added: “Parmenion has enjoyed strong growth in recent years, and we are delighted that Preservation Capital has recognised the potential in our business, and share our future vision.  

“Their belief in us, our teams and what we deliver every day to advisers and their clients means there is total alignment of interests, and we are genuinely excited about our future.”

Private equity pounces on platforms

Parmenion has become just the latest platform to be bought by a private equity house.

In December private equity firm Anacap bought Novia after having bought Wealthtime earlier that year.

James Hay was bought by private equity firm Epiris in 2019 and it has since gone on to buy Nucleus, in a deal announced last month, creating an entity with assets of £45bn.

Andrea Secci, principal of Preservation Capital Partners, said: "The IFA platform sector is one of the most attractive sub-sectors within the UK wealth management market and is experiencing strong organic growth driven by increased regulation and digitalisation of the advisory market.

"Parmenion is one of the leading platforms within the sector with its own proprietary technology that has consistently been ranked by advisers as one of the best platforms in the UK over the last five years."

The Nucleus-James Hay deal was the latest in a spate of platform mergers.

In 2019 Embark bought the Zurich platform and the advised business of Alliance Trust Savings.