Kingswood and its variety of deals

Kingswood Holdings, the wealth and investment management group, has announced its acquisition of Metnor Holdings, the latest deal of many. Patrick Brusnahan writes

Metnor is based in Harrogate and is the holding company for IBOSS Asset management and Novus Financial Services.

IBOSS is a provider of managed portfolio services and other investment solutions.

Furthermore, in the 12 months to 31 October 2021, the IBOSS Group generated revenue of £3.3m ($4.4m) and EBITDA of £1.3m. The IBOSS Group currently employs 29 people and has over 6,000 clients with over £1.4bn of AuA/M. At 31 December 2020, the IBOSS Group had net assets of £3.1m.

The IBOSS brand and team will be kept with Chris Metcalfe and his team remaining in charge of the investment strategy.

David Lawrence, UK CEO at Kingswood, said: “My ambition when taking the reins of Kingswood’s UK business was, and remains, to create a leading financial advisory and investment management business and this transaction is a big step towards that goal.

“In the IBOSS Group, Chris Metcalfe has built a fantastic brand with a superb Investment track record. From our first meeting, we knew that blending the IBOSS Group with Kingswood would create something special in the sector, harnessing the IBOSS Group’s investment record, product range and open market IFA distribution with Kingswood’s existing discretionary investment expertise and rapidly growing financial planning businesses.”

Chris Metcalfe, Investment and Managing Director at Metnor, commented: “The synergy of Kingswood and IBOSS gives both parties an exceptional opportunity to enhance their client propositions and range of services. We had several potential suitors, but none realised the intrinsic value of how we manage money and the attraction for advisers that comes with our industry-leading service standards and client communications.

“As part of the Kingswood Group, we will offer our new and existing IBOSS users an exit strategy that will be one of the most attractive in the industry, something that adviser firms have been asking us to facilitate for some years now. We are pleased to be able to deliver precisely what advisers have asked for. For many adviser firms, continuing the investment proposition and not disturbing the client is extremely important.”

The deal is subject to regulatory approval.

Furthermore, Kingswood is set to acquire the business assets of Kent-based financial planning business Smythe and Walter, subject to completion.

As agreed, Kingswood will pay £420,000 immediately. An additional amount of up to £420,000 will be payable over the next two years, subject to attaining certain pre-agreed performance targets.

Kingswood will fund the acquisition using the cash received by issuing new convertible preference shares.

Smythe and Walter manages around £40m in assets for nearly 100 clients across Kent.

The deal will increase Kingswood’s UK funds under advice/management to £4.7bn. Kingswood Group AuA will amount £6.4bn.

Smythe and Walter CEO Lee Smythe said: “With an ever increasing regulatory burden, joining Kingswood enables us to gain access to the resources and support, which we need to both provide a wider range of services to our current clients and to grow our future business in a cost effective manner.

“In addition to this, given the events of the last 18 months or so, becoming part of a larger firm ensures a greater sense of security for both staff and clients alike.

“With the additional support functions in place, I am looking forward to being able to spend more time on the most important and enjoyable part of our business, looking after our clients.”

Kingswood UK CEO David Lawrence said: “Smythe and Walter are a growing firm and this acquisition enhances our existing footprint in the South East. I am delighted to welcome Lee Smythe and his team to Kingswood.”

This was the company’s third acquisition in 2021.

Kingswood had also agreed to acquire Money Matters, a privately owned wealth management business.

Following regulatory approval, Money Matters will be acquired for cash up to £3.4m payable over a two year period by Kingswood. However, £1.7m will be paid at closing and the balance paid on a deferred basis.

Primarily offering services in the North East of England, Money Matters boosts Kingswood’s UK client facing advisory team to 69 people.

In addition, UK funds under advice/management increase to £4.6bn ($6.2bn) and Kingswood Group AuA now totals over £6.3bn.

David Lawrence, UK CEO at Kingswood, said: “Since becoming UK CEO late last year, I have focused on building momentum in the business and expanding our capabilities to integrate and grow. I am thrilled to announce our acquisition of MMNE and look forward to welcoming Alastair Raine, Chris Woodhams and the whole team to Kingswood.

“Both Chris and Alastair have extensive experience as financial advisers and started MMNE in 2010 with a vision to combine their extensive expertise together to create a client centred business which is a vision that we share at Kingswood.

“The Kingswood model is designed to provide a centralised, efficient support infrastructure to manage the routine, but time consuming tasks required across compliance, finance, human resources, risk and technology, allowing the MMNE team to deliver a superior level of service to their clients. I am really looking forward to working with Chris and Alastair as we further grow the business as part of the Kingswood Group.

“We remain committed to perpetuating our stated growth strategy within the UK and internationally. This is our second acquisition of 2021 and we continue to have a strong pipeline of high-quality UK opportunities under negotiation, six of which are in exclusive due diligence as we continue to grow our financial planning and investment management reach across the UK. We expect to be making more announcements over the coming weeks.’’

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