Newcastle-based advisory platform True Potential has agreed to sell a majority stake in the business to London-based private equity firm Cinven.
Media reports on 8 September 2021 claimed the deal was worth around £2.5bn ($2.9bn, €3.4bn), but the firms did not disclose the sum.
The investment will allow the platform to grow and expand its investment technology.
True Potential was founded in 2007 by chairman David Harrison and chief executive Daniel Harrison. It has more than 1.4 million retail clients in the UK and expects to have around £20bn in assets under management by the end of 2021.
It employs more than 350 people and works with over 800 restricted advisers.
David Harrison, chairman of True Potential, said: “We identified Cinven as the right partner for True Potential’s next phase of growth due to their financial services and technology, media and telecom (TMT) expertise.
“Their investment will enable us to continue to deliver on our mission to revolutionise the way wealth management is provided. We have a shared vision, and I am certain that this investment in True Potential alongside the existing management expertise will deliver continued growth for many years to come.”
Spotlight on tech and recruitment
Daniel Harrison, chief executive of True Potential, added: “Our aim in this process was always to find the right partner with the same values that would benefit our clients, financial advisers and staff. In Cinven we have found that partner.
“The financial advice and investment markets are constantly evolving but we have grown consistently over 14 years by being bold, digital-first and client-focused. This investment and exciting partnership will continue that trend.”
Caspar Berendsen, partner at Cinven, said: “True Potential has a truly differentiated business model within the UK wealth management sector, where there are strong structural growth drivers. The company provides attractive services and products to financial advisers and their clients, using technology to anticipate and meet customer demands in the future as well as now.
“The combination of Cinven’s longstanding track record in both financial services and TMT, along with True Potential’s strong management team and integrated business model, will support the company’s future growth. In particular, this transaction will enable continued investment in True Potential’s financial adviser recruitment and its technology platform.”