Acquisitive Financial Planning group Kingswood has acquired Rotherham-based IFA Allotts Financial Services (AFS).

The deal adds approximately £140m in assets under advice.

Set up in 1998, AFS provides advice to 400 active clients and employs three advisers and five support staff.

Kingswood will pay £2.5m in cash for the IFA, payable over a two year period. The first £1.25m will be paid at closing and the balance on a deferred basis, some of which is subject to performance targets.

In the year ended 31 March 2021, AFS generated revenue of £791,000 and made profit before tax of £355,000.

The deal is the second for the Financial Planning firm in South Yorkshire over the past week.

Kingswood acquired South-Yorkshire-based Financial Planner DJ Cooke in a deal totalling £1.5m last week. 

The acquisition will be funded with money raised by Kingswood from the issue of new convertible preference shares, under the terms of its Convertible Preference Share subscription agreement with private equity firm Pollen Street Capital.

Kingswood's partnership with Pollen Street has so far provided equity of £77.4m to support existing and future acquisitions.

Following the deal Kingswood’s assets under advice will have risen to over £8.1bn from a combination of retail and institutional clients. It boosts Kingswood's UK-client facing advisory team to 83 and increases UK funds under advice to £6.5bn from 16,640 active clients.

David Lawrence, UK CEO at Kingswood, said the firm has another five acquisition deals in the pipleline.

He said: "Allott’s has a great reputation for serving clients over many years and is a great addition to Kingswood’s existing footprint in the wider Sheffield region. After this acquisition is concluded we will have 13 advisers meeting their client financial advice and investment needs.

“We remain committed to perpetuating our stated growth strategy within the UK and internationally. This is our second acquisition of 2022 and we continue to have a strong pipeline of high-quality UK opportunities under negotiation, five of which are in exclusive due diligence as we continue to grow our financial planning and investment management reach across the UK.”

Kingswood has made a number of acquisitions over the past year.

It completed the acquisition of asset manager and IFA the IBOSS Group less than two months after announcing the deal. Kingswood hailed the deal as a “milestone” acquisition. 

Kingswood paid an initial cash sum of £9.6m for Metnor Holdings, paid on closing with deferred consideration of up to £6.4m, payable over a two year period, and a performance-based earn out linked to three years of EBITDA growth.

The Financial Planning firm also completed the acquisition of two advice firms in December, Money Matters (North East) of Redcar and Lee Smythe & Associates Ltd of Faversham.