Second acquisition in 48 hours completes £10m spending spree for wealth manager

AFH chief executive Alan Hudson

Bromsgrove wealth management group, AFH, has announced its second major acquisition in the space of 24 hours.

Just a day after announcing the deal to acquire Parker Sage, a Canary Wharf-based IFA, AFH said it had completed an initial £1.5m deal – which could rise of £4.5m dependent on performance – to expand its coverage in Suffolk with the acquisition of Newmarket-based financial planning firm Eunisure.

The combined deals could eventually amount to more than £10m of investment on the part of the acquisitive AFH.

Under the terms of the latest acquisition, the maximum consideration payable to Eunisure by AFH is £4.5m, which is based on a targeted increase in group profitability.

The initial £1.5m has been funded from the company’s existing cash resources, while the deferred amount of up to £3m will be payable over the next 48 months in four tranches dependent on set performance criteria being met in each 12-month period.

For the 12 months ended December 2016, Eunisure generated revenues of £5.6m, and reported pre-tax profit of £241,927.

Eunisure’s vendor and current managing director Ralph Mortlock will remain a board member following the deal.

Commenting, Alan Hudson, chief executive of AFH, said: “The protection gap in the UK has been widely reported. Eunisure is one of the leading face to face advisory businesses in this sector with national coverage throughout the UK. I believe the acquisition of Eunisure will significantly increase the distribution capacity of AFH whilst at the same time enabling Eunisure to develop rapidly in its core market.

“The deal has been structured to create shareholder value through additional financial planning opportunities and growth within the existing business and I look forward to working closely with Ralph to drive both Eunisure and the distribution of AFH’s wealth management services in the future.

“Yesterday’s acquisition of Parker Sage together with Eunisure’s today represents a step change in profitability for the group adding over £2m of pro forma annualised EBITDA. In addition, we continue to have a strong pipeline of future acquisition opportunities.”

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