Consolidator Fairstone has gained 1,000 clients and £215m funds under management as part of the two latest deals in its buy-out programme.
Lee Hartley, chief executive at Fairstone, said the company's downstream buy-out model, which sees it take a stake in an advice firm before integrating and then purchasing it, was continuing to yield "exceptional results".
The consolidator has most recently signed up Kent-based Goodman Chartered Financial Planners and Sidmouth-based East Devon Associates to the programme in a move which brings with it gross fee income of more than £2m.
Advice firm Goodman Chartered Financial Planners specialises in investments and inheritance tax and adds four advisers to Fairstone's group, whilst pensions and investments specialists East Devon Associates brings with it two advisers.
Mr Hartley said: "Our unique downstream buy-out programme is continuing to yield exceptional results, with a significant number of high-quality wealth management firms being on-boarded and coming through to full acquisition.
"These firms are showing consistent growth in performance as they take advantage of the regulatory, technical and operational support that Fairstone provides."
Fairstone said many businesses it had integrated through the model had exceeded growth expectations, with the company's own figures showing a 15 per cent outperformance across its portfolio of acquired advice firms.
This means the acquired firms have delivered higher revenue, profits or growth than originally forecast in the buy-out agreement.
Andy Smith, principal at Goodman Chartered Financial Planners, said he was attracted to the Fairstone deal as compliance demands associated with direct authorisation were becoming too time consuming and costly.
Mr Smith said the growing compliance burden had been taking advisers away from their primary role of supporting clients.
He added: "Partnering with such a strong national IFA as Fairstone will allow the business to continue to prosper and expand, with greater resources and expertise available."
Graham Salter, principal at East Devon Associates, said: "We feel that these core values are mirrored by the Fairstone proposition. In addition, the extra compliance and technology support that Fairstone provide will allow us more time to focus on our clients’ needs."
rachel.mortimer@ft.com
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