Rathbones and Smith & Williamson have pulled out of talks over a £2bn merger.
The pair confirmed they were in discussions last week.
In a stock exchange announcement yesterday evening, Rathbones says that it has incurred around £5m in costs while eyeing up the deal, but was unable to secure terms that would suit its shareholders.
Rathbones was looking to add tax and accountancy services through the deal, which would build on its acquisitions of IFA network Vision Independent Financial Planning in 2015, and the private client businesses of both Jupiter and Tilney in 2014.
Rathbones chief executive Philip Howell says: “We continue to believe that our proposition was both a compelling strategic and value creation opportunity for all Smith and Williamson’s stakeholders. The potential combination was intended to accelerate Rathbones’ existing strategy, but ultimately we were unable to agree terms that offered our shareholders an appropriate balance of risk and reward.”
In a statement last night, Smith and Williamson says: “Following our growth and business development in recent years, the board had agreed to prepare the company for a potential stock market listing. While we were pursuing this course, we were approached by Rathbones.
“After careful consideration, we have been unable to reach agreement on terms which would be in the best interests of all our stakeholders.”
Rathbones describes the merger talks as “exclusive” and Smith and Williamson also does not reference reports that rival wealth manager Tilney was also interested in the firm.