Tilney Bestinvest eyes regional acquisitions after Towry deal

Hall-Peter-Tilney Bestinvest-2014-700x450.jpgTilney Bestinvest chief executive Peter Hall says the company will not seek any other large-scale acquisitions after its takeover of Towry, instead looking for regional deals.

Tilney Bestinvest is to acquire Towry for £600m, buying the entire company, including Palamon Capital Partners’ majority stake and shares owned by Towry staff. The combined business will have over £20bn of assets and will employ more than 240 financial planners and 120 investment managers.

“What we wanted to do was to create the leading firm in the UK in both financial planning and investment management and the combination of the two firms gets us there in one go. It’s a fantastic strategy in terms of achieving that objective,” says Hall, speaking to Fund Strategy.

The focus for the coming year will be on integrating the two businesses, with Hall saying that the company is not looking for further large-scale acquisitions.

“Any acquisition in the future will be regional in-fills rather than anything transformative,” he says.

The Towry acquisition will also lead to some job losses, with both the Towry and Tilney Bestinvest sides having some crossover in job roles, says Hall. Towry employs 900 people while Tilney Bestinvest employs 400 staff.

Hall plans to appoint his leadership team within the next two weeks, using a meritocratic process to pick which individuals stay in their roles. It has already been revealed that Towry chief executive Rob Devey is leaving the firm, with Hall leading the combined company.

“We are going to follow the same approach that we will follow in the overall integration of the companies, taking the best of both sides of the leadership team, drawing from both teams,” he says. He could not give a figure of the job losses.

“The overriding objective is to create the best firm in the industry and a firm that is growing and strong. There will be some areas of overlap that will result in redundancies, but cost reduction is not the motivation, the focus is on creating an exceptional business,” he says.

The company will merge some offices and close others. Where both Towry and Tilney Bestinvest have offices and there is capacity they will move under the same roof.

However, both firms will retain their London offices for the time being, he says.

In the interim the firm will retain both the Tilney Bestinvest and Towry brands, but Hall says they will revisit that branding decision at the end of the year. He says the firm will do some research on each of the brands to determine whether to merge under one brand or retain both.

“We will just make the branding decision dependent on the research and how brands are viewed in the marketplace and by customers,” he says.

Both Towry and Tilney Bestinvest have been no stranger to acquisitions over the years.

Tilney Bestinvest most recently acquired £1.8bn investment manager Ingenious Asset Management to get access to high-net-worth London-based clients. Tilney merged with Bestinvest in March 2014.

Towry has expanded through several acquisitions in recent years, buying Ashcourt Rowan for £120m in March last year and acquiring Baker Tilly in 2014.

Towry’s private equity backer Palamon Capital Partners originally planned to float the advice firm on the stock market, but abandoned those plans in favour of a sale this year.