The Jersey wealth arm of Royal Bank of Canada (RBC) has agreed to buy Brewin Dolphin, subject to shareholder and regulatory approvals.
RBC Wealth Management (Jersey) has bid for the entire issued and to be issued share capital of Brewin Dolphin for 515 pence per share, which comes to a total value of £1.6bn ($2.1bn, €1.89bn).
Brewin Dolphin is a wealth management firm with operations in the UK and Ireland, with a network of more than 30 offices and assets under management of £59bn, as at 31 December 2021.
After the deal, the combined business will have £64bn of AuM, a combined annual revenue of £545m for FY 2021 and approximately 600 client-facing professionals as at 31 December 2021.
RBC said in a London Stock Exchange announcement on 31 March 2022 that the deal is an “exciting strategic opportunity” for the bank to combine its existing wealth business in the UK and the Channel Islands with Brewin Dolphin to “create a market leader”.
The acquisition “establishes an attractive platform for further growth” in the UK and the Channel Islands, RBC added.
For the deal to go ahead, 75% of Brewin Dolphin’s shareholders need to approve it. RBC and Brewin Dolphin expect the acquisition to complete by the end of Q3 2022.
Doug Guzman, group head of RBC Wealth Management, RBC Insurance and RBC Investor and Treasury Services, said: “The UK is a key growth market for RBC, and Brewin Dolphin provides us with an exceptional platform to significantly transform our wealth management business in the region, giving RBC Wealth Management a number three market position in the UK and Ireland, in addition to being a market leader in Canada, with a growing position in the US.
“By combining two highly complementary businesses, we will increase the depth and breadth of our services and position the combined business as a premier integrated wealth management provider to private and institutional clients.
“Both management teams are excited by a shared vision of high-quality client service, client-centric culture and the exceptional growth opportunities that we can deliver together. We look to continue investing in the combined business and take it to greater heights. We are confident that this acquisition will deliver benefits to our combined clients, employees and stakeholders.”
Robin Beer, chief executive of Brewin Dolphin, added: “The Brewin Dolphin board is pleased to recommend the offer by RBC in the interests of our shareholders, our clients, our people and our business partners. Building on the strong organic growth that we have achieved to date; the combined businesses will create an attractive platform for future growth.
“As part of RBC, we would be able to provide our clients with a broader range of products and services and expand our distribution channels through leveraging RBC’s global presence. We share complementary values which emphasise the importance of long-standing client relationships and an inclusive culture supportive of employees and local communities.
“Our focus will be on maintaining continuity, so that we build on what we have already achieved. I am looking forward to us working together to enhance our market position as a leading advice-focused, digitally enabled wealth manager.”