The move comes after months of uncertainty about the future of the firm. It says the move shows the full backing of owners AWD AG and Swiss Life in the firm’s core UK businesses.
Read operations and Home Finance are both to be divested as part of the deal. Read is a 20-strong at-retirement business, while Home Finance is a mortgages and loans arm.
AWD Group plc chief executive officer Mike Kirsch says: “This is a new dawn for AWD Chase de Vere in the UK. We can now put the difficulties of the past behind us and concentrate on achieving our vision of becoming the UK’s leading independent advisory business. We have received the unequivocal backing and a substantial capital injection from our owners AWD AG and Swiss Life giving us the financial resources and regulatory capital to further develop and invest in our core UK businesses.”
AWD Chase De Vere says the simplification of its business model will see it return to profitability by 2010. Changes implemented by the firm include a reduction in the headcount of its financial advisers as well as the launch of its own platform, which is expected to raise £400m of assets by the end of 2008.
Kirsch says: “Both AWD Home Finance and Read are good businesses with a positive future, however they have very different business models from AWD Chase de Vere, are facing difficult market conditions and operate at the opposite end of the socio economic spectrum from our wealth management business. As such they offer no real business synergy and we believe that the interests of our shareholders as well as Read and Home Finance are best served by them developing outside the Group.
“Taken together, our strong actions in addressing past difficulties, restructuring our business and achieving the unequivocal financial backing and commitment of our shareholder now positions AWD Chase de Vere to become one of the most successful advisory businesses in the UK.”