Brooks Macdonald International (BMI) is to be sold to Canaccord Genuity Wealth Management for a total consideration of up to £50.85m, including an initial consideration of £28m payable in cash upon completion.
The binding agreement to buy the wholly owned subsidiary of Brooks Macdonald Group, comprising offices in all three crown dependencies, is expected to complete by March 2025 subject to regulatory approvals in a statement today (12 September) included in its results.
The deal concludes the previously announced strategic review on 7 March of the group’s international operations, covered by Investment International earlier this year
Contingent consideration of up to £22.85m is payable in cash two years post-completion “dependent on the revenue performance of the BMI business”.
“The proceeds of the disposal will allow for focused investment in the group’s core proposition and will enhance its ability to capitalise on the structural opportunities in the UK, to grow organically and through targeted M&A”, the statement said.
As of 30 June 2024, BMI had £2.3 billion of funds under management. In the financial year 2024, BMI delivered revenue of £19.9m and £3.3m of underlying profit before tax1.
When the group announced it had commenced the strategic review “various options for BMI have been considered as part of this review”.
The board said it had now concluded that the sale of BMI is in the best interests of the group as it simplifies the group’s operations to focus on its core activities of high-quality investment management and financial planning within the UK.
In reaching an agreement with Canaccord, the Board has achieved an attractive result for the Company and its shareholders.
The transaction would also secure “a highly credible future owner for BMI with a strong presence in the Crown Dependencies. The Group will work with Canaccord to ensure a smooth transition for existing BMI clients.”
BMI will be acquired by Canaccord with an agreed level of regulatory capital, with any surplus paid for at completion.
The group will incur £3-5m separation and transitional arrangement costs which will be treated as exceptional items in the current and the following financial year.
Andrea Montague, CEO designate & chief financial officer of Brooks Macdonald, said: “We are pleased to announce the sale of BMI to Canaccord as their presence and understanding of the local markets will provide a strong foundation for the future growth and development of the business. I would like to thank all our BMI colleagues for their commitment to their clients and professionalism. We wish them all the best for the future.”
David Esfandi, chief executive officer of Canaccord Genuity Wealth Management, said: “Brooks Macdonald International is a quality business and an excellent strategic fit for our international division. This is a mutually beneficial transaction that will cement Canaccord’s position as a fully-fledged integrated wealth manager.
“Both firms are well-established across the Crown Dependencies, and BMI will also add significant financial planning expertise in our international business. Canaccord has a robust and scalable operating platform with a proven track record of successfully integrating businesses, and we anticipate a smooth process for BMI in 2025.”
Andy Finch, CEO, International, Canaccord Genuity Wealth Management said: “This investment reflects our deep commitment to building a world-class wealth management business in the Crown Dependencies and continuing to provide a platform for ongoing growth and success.
“BMI is a well-respected business and brings strong cultural and geographical alignment with Canaccord. Along with a new cohort of talented colleagues, we look forward to welcoming our new clients who will continue to receive the highest standards of service.
“With BMI’s financial planning capability, we look forward to building on our market-leading investment management service to provide Canaccord’s international clients with a more integrated wealth management proposition.”
Mark O’Connor, Managing Director for Channel Island & the Isle of Man at Brooks MacDonald International, said: “We are excited about the proposed move to Canaccord Genuity, which, pending regulatory approval, will bring enhanced benefits to our clients through access to global expertise and resources. This alignment will further strengthen our commitment to delivering exceptional service and driving long-term growth across our international markets.”
Brooks Macdonald is being advised by Raymond James Financial International Limited, and Travers Smith LLP as legal adviser, in relation to the sale of BMI.
