Both firms are based in the City of London, a short distance from each other.
The Prospect deal will increase IPS’s total assets under management to more than £600m. IPS is a boutique multi-asset investment manager.
Prospect is a branch of Raymond James Investment Services and was founded by Matthew Hunt in 2006.
Mr Hunt, a Chartered Financial Analyst, is one of the two principals of Prospect which he started with Pat O’Hara, one of the founders of Ascot Lloyd. Since the sale of Ascot Lloyd, which he still part owns, Mr O’Hara has devoted more time to Prospect. Mr Hunt started Prospect after a career in investment management in London with Close Brothers Group, Coutts & Co and Chemical Bank.
Mr Hunt and his team of six will join IPS and work with both firms’ clients. Mr Hunt will become a partner of IPS Capital LLP.
The combined business will be aimed at high and ultra-high net worth as well as mass affluent investors across the UK and internationally.
Jonathan Blain, chief executive of IPS Capital, said: “Our strategic partnership with Prospect enhances our collective investment expertise, which we believe will add value to both firms’ clients.
“Our personalised service provides a clear point of differentiation from the larger, often listed wealth managers. We are delighted to welcome Matthew and his team into the IPS family.”
Matthew Hunt, chief executive of Prospect, said: “The key to any successful grouping is the fit between the businesses. IPS and Prospect are completely complementary in terms of our respective investment capabilities, culture and distribution focus.
“We have known each other for around seven years, and this strategic partnership is great news for both client sets.”