Canaccord Genuity, through its UK wealth management business CGWM UK, has signed an agreement with Punter Southall Group, to acquire its Punter Southall Wealth (PSW).
Under the terms of the agreement, CGWM UK will make an upfront payment of £164m to PSG, along with equity interest comprising newly-issued shares in CWGM UK.
The company will provide retention and incentive awards to certain key employees of PSW, with a combined attributed value of around £6m.
Upon closing, CGWM UK is expected to add £100m to its existing bank facility, while HPS Investment Partners has agreed to make an additional investment in CGWM UK.
HPS will purchase a new series of convertible preferred shares of CGWM UK worth £65.3m.
PSW will be acquired with a minimum level of regulatory capital, and any surplus will be distributed to PSG in the form of a pre-completion dividend, said CGWM UK.
The acquisition includes the intermediary-facing brand Psigma, and its completion is subject to certain customary closing conditions, including regulatory approval.
CGWM UK CEO David Esfandi said: “Our acquisition of Punter Southall Wealth represents an exciting strategic opportunity to further develop our integrated wealth management business, adding national scale and exceptional capability to our advice-led offering.
“We see a strong cultural fit between CGWM UK and PSW and we look forward to supporting this talented team, as we work together to build upon the strong foundations that both of our businesses have established to date.”
As part of the acquisition, PSW’s investment professionals, financial planners, and clients will be moved to CGWM UK.
With the transition, the PSW team can access the wide range of resources offered by CGWM UK and its global platform.
PSW is a vertically integrated wealth manager, providing advice and wealth management solutions to high net-worth individuals, with around £5bn in client assets.
Its services include custom-made portfolios, managed portfolio services and a multi-asset fund range, supplemented by a strong intermediary distribution channel.
The acquisition is not expected to affect PSW’s core offering, as well as existing relationships between portfolio managers, financial planners and their clients.
Punter Southall Wealth chief executive officer John Howard Smith said: “There is a strong cultural fit between Punter Southall Wealth and Canaccord Genuity and we share a commitment to provide the highest standard of financial advice and investment management, while fostering enduring client partnerships.
“Being part of a well-capitalised, international group provides good opportunities to grow our existing operations while providing continuity for our valued clients and the exceptional team we have.”
Fenchurch Advisory Partners served as financial adviser and Farrer & Co as legal adviser to CGWM UK, while Spencer House Partners served as financial adviser and Ashurst as legal adviser to Punter Southall Group, on the transaction.
