Tilney announces 'transformative' merger with £45bn of AuM
UK-based Tilney confirmed this morning a merger with Smith & Williamson which will create one of the UK's largest wealth management and professional services groups with over £45bn of assets under management.
The merged business, which upon completion will be renamed Tilney Smith & Williamson, will "offer an unrivalled breadth of value-added services focusing on private clients, businesses and charities."
The combination of Tilney and Smith & Williamson brings together two of the UK's longest established and highly successful wealth management and professional services businesses, founded respectively in 1836 and 1881. Both firms have strong reputations for their high standards of professionalism, expertise and personal service.
This is a transformational deal, which will create a truly unique business, able to support clients from across the wealth spectrum with a comprehensive range of services for both their personal wealth management and business needs."
Smith & Williamson shareholders will receive consideration valued at £625m, to be satisfied through a combination of cash consideration and shares in the enlarged group. Smith & Williamson management shareholders will be rolling the majority of their investment into the equity of the enlarged group. The transaction values the combined business at an enterprise value of approximately £1.8bn. The combined business will have revenues of circa £500m and EBITDA of £150m. The transaction is expected to complete in early 2020, subject to regulatory approvals.
Smith & Williamson and Tilney operate businesses that are highly complementary in the services they offer, the spectrum of clients they serve and in their geographic presence. The combined firm will be uniquely positioned to support clients with their personal wealth management needs and their business interests.
In addition to its strong investment management expertise, Tilney is a market leader in financial planning and has an award-winning digital investment platform in Bestinvest. Smith & Williamson is one of the most respected investment managers in the UK, offering leading expertise in tax advice and an extensive range of professional services through its status as a top ten UK accountancy firm.
Chris Woodhouse, chief executive of Tilney, commented: "The merger of Tilney and Smith & Williamson represents a compelling combination and together we will look to build on the considerable and complementary strengths of both firms. Like Tilney, Smith & Williamson has an excellent reputation for looking after its clients over many years and we recognise the value its culture and expertise will bring to the combined group.
"This is a transformational deal, which will create a truly unique business, able to support clients from across the wealth spectrum with a comprehensive range of services for both their personal wealth management and business needs.
"Tilney Smith & Williamson will be responsible for over £45bn of client assets, of which 80% is in discretionary mandates or funds. It will have a significant number of trusted advisers, including approximately 280 investment managers, 260 financial planners and a professional services business with circa 150 partners and directors.
Alongside the benefits of scale and an enhanced service offering, we will continue to focus on providing clients with a very personalised service, delivered by highly qualified professionals from locations across the UK, Ireland and Channel Islands. Given the excellent strategic and cultural fit between our businesses, I believe that the combined group is ideally placed to maximise the growth opportunities that we see in the market."
Mutual benefit
David Cobb and Kevin Stopps, co-chief executives of Smith & Williamson, added: "We are delighted to be merging with Tilney, a business that we believe is an excellent partner for Smith & Williamson. The enlarged group will be a leading wealth management and professional services business, benefiting clients and colleagues in both companies.
The investment management and professional services market is changing rapidly, with the evolution of client needs accelerating. The combination of our two businesses creates real scale, broader capabilities and complementary service offerings, enabling the merged group to enhance existing client relationships and win a higher share of new business opportunities. We look forward to working with Tilney's management to complete the transaction and bring the two companies together."
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