Acquisitive wealth management firm kicks off new financial year with £4.5m deal

AFH chief executive Alan Hudson

Bromsgrove-based wealth management firm AFH has kicked off its new financial year with the acquisition of a firm based in York.

AFH has completed the acquisition of Premier Wealth Management Harrogate, a deal which will see Richard Evans, Andrew Huby and their support staff will join AFH, bringing more than £90m of FUM to further extend the operations of AFH in the North East.

Under the terms of the acquisition, the maximum purchase price is £4.5m dependent upon performance criteria of the business.

The initial consideration for the acquisition is £2m in cash, funded from the company’s existing cash resources.

Further deferred consideration will be payable in cash over the next 26 months, subject to enhanced performance criteria of the business being achieved.

For the year ended December 2017, the business reported revenues of £0.7m and profit before tax of £0.35m.

Evans said:“For a while it’s been clear that to take the business to the next stage we needed to become part of a larger organisation.

“Frankly with the likes of MiFID and PI costs it’s becoming impossible to deliver the proposition we want for our clients at a cost that’s competitive. With AFH we’re going to be able to drive costs down for our clients while delivering a great investment proposition.”

AFH chief executive Alan Hudson said: “It’s great to welcome Richard, Andrew, Tom and Lottie to the AFH family. The different tracks they’re taking in joining us highlight our commitment to the future of the industry. And I know their clients are going to appreciate seeing more of them and learning about the AFH proposition.

“This deal reinforces AFH’s place as a welcoming home for IFA businesses of all sizes, whether they’re looking to offer an even better service to their clients, grow their business or arrange an orderly exit from the industry.

“The acquisition of Premier is the first transaction of our new financial year and, following the acquisition of Thomas Heald in August, continues the expansion of AFH in the North East.”

Last month, AFH said it has “a strong pipeline of potential acquisitions that are under negotiation” and expects to complete more deals.

The firm has spent £16m acquiring 16 businesses in the last year and said it “remains well positioned to take advantage of consolidation opportunities in the IFA market”.

AFH’s turnover in the half year to 30 March 2018 was £22.7m, up more than 60% on the same period the year before. It currently has around £4.5bn funds under management.

Since 2014 AFH has been listed on the London Stock Exchange’s AIM. Its current market capitalisation is £160m.

Click here to sign up to receive our new South West business news...
Close