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Foster Denovo chief says he has cash to buy IFAs

Foster Denovo chief says he has cash to buy IFAs

Foster Denovo has said it has secured funding for acquisitions.

Towards the end of last year the company changed its status from public to private to encourage private equity investment.

A spokesman for Foster Denovo said: “We are pleased to confirm that we have secured funds to support our acquisition strategy and are actively looking for potential opportunities.”

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Foster Denovo did not respond to requests for information about where these funds had come from or how much cash had been raised.

In 2014 and 2015 the number of advisers at Foster Denovo fell from 90 to 73, with the company saying this has hit its revenue and productivity.

Earlier this year, Foster Denovo, part of the Foster Denovo Group, posted a loss before tax of £1.8m for 2015 compared with a £1.3m profit in 2014 which it attributed to the loss of advisers.

Roger Brosch, chief executive of Foster Denovo, told FTAdviser in March that he had struggled to find quality IFAs to swell the company’s ranks so would be looking to buy firms.

When Foster Denovo ceased to be a public company, it said corporate finance advisers had advised that private equity investors would not put themselves in a position where they were required to make an offer to optionholders of the company to buy out their options and so private equity investors were likely to require the re-registration of the company as a condition of providing funding.