Mattioli Woods has scrapped its plan to buy Amati Global Investors and will remain a minority shareholder.
The company bought 49 per cent of Amati in February 2017 and has since been reviewing how to attract and retain talent within the business.
As a result it has scrapped its plans to buy the remaining 51 per cent for a payment of £750,000 as had been planned.
Ian Mattioli, chief executive of Mattioli Woods, said: "Given the success of the current arrangement, I believe the group retaining a minority interest in the joint venture offers the optimal structure for all its stakeholders."
Amati specialises in investing in UK small and mid-sized companies, including those listed on the Aim and part of the FTSE 250. It runs a venture capital trust and offers an inheritance tax portfolio service.
In a trading update, Mattioli Woods revealed it had seen "strong" earnings growth, with total client assets reaching £8.8bn at the end of November 2018.
This included gross discretionary assets under management of £2.4bn.
Mr Mattioli said: "Slightly lower than expected revenue growth is a combination of the group reducing our clients' costs and general market conditions.
"The impact of this has been more than offset by a continued focus on operational efficiencies and other administrative cost savings, resulting in strong profit growth.
"We intend to continue managing the cost base against the backdrop of an uncertain market outlook. I have previously indicated that I believe fees for financial services in the UK are too expensive and have set out our aim to lower client costs, whilst building a long-term sustainable business."
Mr Mattioli added that the company's acquisition of Broughtons Financial Planning in August 2018 had made a positive contribution to its growth in profits.
damian.fantato@ft.com
