The combined organisation will look after more than 40,000 fee-paying clients, with bosses saying it becomes one of the largest independently-owned wealth management businesses in the UK. The fee was undisclosed.

Both businesses are owned by the global alternative investment management firm Oaktree Capital Management.

The new combined entity also incorporates BIA Financial Planning, the independent advice arm of Bellpenny. The brands of all three businesses will remain.

Nigel Stockton, Bellpenny’s chief executive, and Matthew Moore, Bellpenny’s chief financial officer, becomes chief executive and chief financial officer of the new business respectively. Richard Dunbabin and Pat O’Hara of Ascot Lloyd remain as founders and assist the executive director leadership team.

Ascot Lloyd Bellpenny CEO Nigel Stockton said: “The logic behind this deal is truly compelling. The new entity merges two near-identical sized businesses with similar structures and closely-aligned client propositions. It delivers material long-term benefits and expanded opportunities for both companies’ private and corporate clients, along with increased resources and expertise.

“Having grown from a zero base to more than £6 billion of funds under management in less than five years, this deal makes us one of the UK’s biggest independently-owned wealth managers and undoubtedly the fastest-growing. We have the ambition, strategic direction and financial firepower to expand still further.”

Richard Dunbabin, founder director of Ascot Lloyd Bellpenny, said: “We are proud to have built Ascot Lloyd into one of the UK’s most successful and enduring IFA businesses, with a heritage stretching back more than eight decades. The merger with Bellpenny provides the financial backing to grow the business in the future. This can only provide greater stability, security and comfort to our clients - qualities that are at a premium in these uncertain economic and political times.

“I look forward to working closely with Nigel to ensure this is the most successful deal either one of us has been involved in to date.”

Grenville Turner, chairman of Ascot Lloyd Bellpenny said: “This transaction epitomises the ’fewer, bigger, better’ acquisition strategy we’ve been pursuing within the UK wealth management market over the past 18 months. It would have taken dozens of mid-sized acquisitions to deliver the step change in funds under management that is being achieved via this merger of equals.

“Bringing together Bellpenny and Ascot Lloyd presents a clear opportunity for material cost and revenue synergies. The board is very excited by the future growth potential, both organic and acquisition-based, of the combined businesses.”