Bankhall parent company Lynx is in advanced talks to buy DBS Financial Management along with its Assureweb online portal in a bid to grow its IFA operations.
The acquisition by software and computer services firm Lynx would make Bankhall Investment Services the biggest player in the IFA services market, increasing its total of registered individuals from 4,000 to around 6,900.
This would put it ahead of Misys IFA services, which has nearly 4,500 RIs, representing almost 20 per cent of the IFA sector.
The DBS network was founded by multi-millionaire entrepreneur Ken Davey in the mid-1980s and was for a long time the UK's biggest network.
Lynx and DBS are both listed on the London Stock Exchange. One market analyst placed Lynx's current market value at £133m on its share price of 78p and DBS's value at £27m on its share price of 53.5p at the time of going to press.
The analyst says he would be surprised if Lynx paid more than £32m for DBS, given the IFA network's share price decline from its highest level of 265p about a year ago.
A DBS member says: “Bankhall has a good reputation and I would hope it would be a seamless transition if it goes ahead. I am not terribly averse to this. DBS has got a little pedantic of late and it may loosen compliance up a bit. But I do hope charges do not go up and the DBS philosophy does not change.”
Cap Gemini Ernst & Young vice-president and head of insurance services Shaun Crawford says: “The big attraction for Lynx must be Assureweb. There has been a strong need for some time to consolidate the portals in the IFA market and most providers have been pulled from pillar to post on which one to use.
“It is also welcome from the point of view of consolidating support services for IFAs in terms of training and compliance and administration. Both companies have strong proposition and could be a powerful force if they integrate well. But integration will be a big issue.”
Bankhall director Tony Murrell says: “We cannot comment on market speculation.”
DBS public relations manager Sue Lewis says: “We do not make comment on speculation.”