Investment management firm Brooks Macdonald Group is to acquire 100% of the issued share capital of Edinburgh-based independent asset and wealth management company Cornelian Asset Managers.
The deal is expected to be up to £39m ($50m, €45m), with an initial consideration of £31m – of which £22m will be paid in cash and £9m in Brooks Macdonald shares.
At the same time, the investment manager is going to conduct an equity placing of new ordinary shares in the capital of the company to raise around £30m to fund the cash payment side of the acquisition.
The M&A deal, Brooks said, is going to strengthen its intermediary distribution reach and increase the group’s direct client offering.
Caroline Connellan, chief executive of Brooks Macdonald, said: “The transaction creates value for our shareholders and, crucially, will provide benefits for both firms’ clients and the intermediaries with whom we work.
“The acquisition of Cornelian is a significant step forward in our medium-term strategy of delivering sustainable, value-enhancing growth.”
Jeremy Richardson, chief executive of Cornelian, said: “Throughout our discussions with Brooks Macdonald, we have been impressed by their strong client focus and growth aspirations.
“It has been client and intermediary support over many years that has enabled us to build a successful business.
“Therefore, it was important to us to find a company with a similar culture and investment philosophy, and critically one that we were confident would provide the highest levels of service to our clients and intermediary supporters. We are very pleased to be joining Brooks Macdonald.”