Aegon's buying spree continues with the outright purchase of leading national corporate IFA Momentum.
The purchase, for an undisclosed sum, will not affect the firm's independent status but means a third big brokerage will not place business with Aegon-owned Scottish Equitable or Aegon Asset Management until the current rules are changed.
The Hampshire-based IFA was created by a management buyout from giant global broker Aon's UK operation two years ago and employs 80 RIs in a total staff of 230. It specialises in the corporate market. This is an area that Aegon plans to expand with second-tier advice. Momentum had a turnover of £14.8m and made £1.9m gross profit last year.
Last week, Aegon UK bought Advisory & Brokerage and 50 per cent of Wentworth Rose in June. The Dutch company now has 155 RIs under its wing and plans to buy up to another seven IFA firms by the end of the year.
Analysts say estimating the price paid for Momentum is difficult as there are sharply divergent opinions about what IFAs are worth.
Momentum managing director Paul Johnston says:”I believe that at some stage 'better than best' will go, which would be a good thing for the market. However, CP121 is irrelevant to our business plan – our business model remains as an independent financial adviser. We will be aggressively targeting the SME and corporate sectors.”
Aegon UK chief executive David Henderson says: “This is certainly a bigger purchase than the other two. We got good value for the business we have bought.
“We particularly favour the employer sector. Second-tier advice in the workplace, if economically viable, could deliver a substantial proportion of Government policy in getting larger parts of soc-iety to save.”
Numis Securities analyst Justin Bates says: “It makes sense for Aegon as it gives them a lift up the ladder of distribution and significant access to a new target audience.”