Charles Stanley has acquired investment and wealth manager Evercore Pan Asset for an undisclosed initial cash sum and is likely to make significant cost savings by merging the companies.
Further amounts will be paid over the next 12 and 18 months subject to Pan Asset's overall performance and the acquisition is conditional on change of control permission being granted by the Financial Conduct Authority.
Pan Asset offers a range of asset allocation advice across global asset classes and specialises in the use of passive (index tracking) investments. It has particularly targeted the Financial Planning and wealth management sectors.
Founded in 2007, its clients include pension funds, charities, universities and family wealth. Pan Asset had assets under management of £593m as at 31 October including directly managed client portfolios, model portfolios on wrap platforms and two open ended UCIT investment funds.
Charles Stanley provides a range of investment management services to retail investors, both direct and via advisers.
It provides discretionary, advisory and execution-only services through its national network of 32 offices plus a range of actively managed model portfolios available on a variety of platforms and through Charles Stanley Direct, its online offering.
Mike Lilwall, director of Charles Stanley Group, said: "The acquisition of Pan Asset will complement the company's existing distribution channels by broadening Charles Stanley's expertise and product offering into the area of passives and in particular we foresee opportunities to enhance our increasing offering to the financial adviser marketplace.
"Further opportunities include the provision of cost effective pension products by combining the Pan Asset active management process with {desktop}{/desktop}{mobile}{/mobile}
Charles Stanley and Charles Stanley Direct's services. This includes a full range of Sipp and Isa wrappers together with traditional investment accounts.
"We also anticipate that Pan Asset's strong asset allocation skills will further improve our asset allocation models and we welcome the team to Charles Stanley."
Pan Asset will be integrated within Charles Stanley's funds division where it is anticipated cost savings will be achieved by the elimination of duplicated systems costs and utilising Charles Stanley's sales and distribution network.
Pan Asset has been operating near break-even and the actions are expected to make Pan Asset immediately profitable and leverage its considerable operational gearing.
Evercore Pan Asset Capital Management
was founded in 2007 by politician John Redwood and Christopher Aldous with the aim of providing a different approach to investment management.
John Redwood held senior investment roles at Robert Fleming and NM Rothschild in the 1970s and 1980s. Since then he has been a pension trustee, investment committee member for an Oxford College, chairman of an investment company and a non-executive director of a hedge fund and an investment trust. An early advocate of tracker funds, he has written extensively on economics and investment.
Christopher Aldous has been involved in wealth management since joining Cazenove in 1981.