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Advice firm no longer wooing buyers

Advice firm no longer wooing buyers

Wealth management company Frenkel Topping has ended its attempts to sell itself after conducting a strategic review.

In April the company had put itself up for sale to “enhance its competitive position” following the government decision to slash the discount rate used to calculate compensation awards for serious personal injuries.

Frenkel Topping is a specialist provider of independent financial advice and wealth management to those in receipt of personal injury or clinical negligence claims.

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But following the conclusion of the review the company’s board decided it was in its best interests to remain an independent company, with enhanced prospects following the discount rate decision.

In a statement to the London Stock Exchange this morning, Frenkel Topping said the effects of the decision are already starting to translate into higher levels of damages to their clients.

The company said: “The board remains fully focused on reaching assets under management of £1bn on an organic basis and remains open to opportunistic investments, both to maximise its return on its cash position, as well as other investments and acquisitions that might accelerate the growth of the business and strength of the platform in place.”

Frenkel Topping also said it expects to increase its market share by expanding its London office, increasing the number of authorised individuals it employs and establishing more joint venture relationships with legal firms.

It said it would announce its half year results in early July, when it expects to report increased profits of £1.2m and increased assets under management of £770m.

In February the Ministry of Justice announced it would cut the discount rate, which is used to establish lump sum compensation to claimants, from 2.5 per cent to -0.75 per cent.

The Association of British Insurers has labelled the change “crazy” and “reckless” and predicted that premiums for drivers and businesses across the UK would increase.

Last month Frenkel Topping said its pre-tax profits dipped during 2016 to £900,000 but it has said the launch of Frenkel Topping Investment Management last year, which runs a discretionary fund management and financial planning proposition, will deliver a “step change” in the company’s profitability.

damian.fantato@ft.com