Wealth management firm Brooks Macdonald Group has acquired Arch cru investment manager Spearpoint in a deal worth up to £45m.
Spearpoint, a discretionary fund manager based in Jersey and Guernsey, took over management of the Arch cru cell companies from Arch Financial after the Arch cru fund range was suspended in March 2009.
Spearpoint has approximately £1.1bn of assets and funds under management. The combined group will have discretionary funds under management of approximately £4.5bn, excluding advisory, property and third party administration assets.
Brooks Macdonald will pay an initial consideration of £23.1m to acquire Spearpoint as a mixture of cash and equity. A deferred consideration will be paid in cash in November 2014.
Based on Spearpoint’s discretionary funds under management remaining at the current value, Brooks Macdonald expects the consideration to be around £4m.
Brooks Macdonald also expects to pay an additional £5m of deferred consideration, based on its growth predictions for Spearpoint over the next year. The total consideration payable is capped at £45m.
Brooks Macdonald Group chief executive Chris Macdonald says: “The acquisition of Spearpoint is a major step forward for the group and captures an opportunity we have been seeking for a number of years. It adds scale, offshore and international capability, together with the acquisition of a strong investment management and pensions team.”
Clearwater Financial Planning managing director Duncan Carter says: “Brooks Macdonald is unlikely to put any weight on the Arch cru connection, as Spearpoint does not own the funds but is simply running them down. This acquisition is probably just an easy way into the offshore market.”