AFH seeks retiring types as it makes further acquisitions

BROMSGROVE financial services group AFH has started the year in acquisitive fashion, purchasing two rival firms.

And it says future targets are likely to involve companies where the principals are retiring. 

It has acquired Roxborough Consultancy and First Class Financial Management.
 
The principal of Roxborough, based in Didcot, Oxfordshire, will retire following completion and existing AFH advisers will take over their client relationships.

Its acquisition, and that of the assets of West Bromwich-based First Class Financial Management, will add a further £55m to AFH’s funds under management.
 
Under the terms of the acquisition of Roxborough, the maximum consideration payable by AFH is £911,760 in cash, via an initial cash payment upon completion of £476,760, followed by a further cash consideration of up to £435,000, payable over the next 26 months in two tranches and dependent upon performance criteria of Roxborough over the next two years.

The consideration will be satisfied from AFH’s existing cash resources. For the year ended 31 March 2014 Roxborough generated a profit before taxation of £185,793 and it had net assets of £370,749.
 
Under the terms of the acquisition of the assets of First Class the maximum consideration payable by AFH is £84,000.
 
These two transactions represent the fifth and sixth acquisitions since AFH listed on AIM in June 2014.
 
Today’s news follows the acquisition of Knight O’Byrne in November.
 
Alan Hudson, chief executive of AFH, said: “We continue to seek, select and complete opportune acquisitions in a post-RDR world. Today’s news takes the company to six acquisitions in only seven months since we migrated from ISDX to AIM.

“We offer IFA businesses, of all sizes irrespective of geography, the opportunity to either become part of a larger group or to allow the principals of those businesses the ability to realise value as they retire.

“We intend to focus our acquisition strategy on retiring IFAs  over the coming months as part of our overall growth strategy.”