Ashcourt Rowan’s status as a fully independent advice business could be under threat after Towry revealed plans to buy the firm.
On Monday, Towry set out details of a proposed £97m deal that has already been approved by Ashcourt Rowan’s board.
Ashcourt Rowan chief executive Jonathan Polin will leave the firm if the shareholders take up the £2.70 and 5p loan note per share offer that still needs regulatory and High Court approval.
The former Ignis boss says it is a “great result” for the team to turn the business around from a share price of £1 when he took over in September 2011 to £2.70 today.
He also stands to make a large slug of cash from the deal, which should be finalised in three months. Polin will receive £625,000 from the sale of his 0.65 per cent stake in Ashcourt Rowan along with severance pay, netting him a total of £4.4m.
Towry chief executive Rob Devey, who replaced Andrew Fisher in April, says he cannot say whether Ashcourt Rowan will remain independent.
“To be honest we have no real view on that at the moment,” he says. “The way we do things at Towry is a pretty open restricted [model] and we’re further extending what we’re doing.
“We genuinely can’t say at this stage but Towry is becoming progressively more open, I can say that.
“We cover a massive part of the market in terms of what we do here, but we are quite conservative so when we had to make a choice we went with restricted.”
The integration of Ashcourt Rowan and Towry will broaden the range of promoted investments offered by the group, he says.
A single-brand is planned for the two businesses, he says. A review of the businesses and how they will integrate is on the cards after the deal is inked and redundancies are likely.
“It is too early to say which brand is the best to take forward,” Devey says.
He expects to see the slew of mergers and acquisitions continue this year.
“It’s quite costly to run a firm of financial planners and wealth managers and if we can spread that cost over more clients and colleagues that’s going to make a better outcome,” Devey says.
“There are great advisers and firms out there thinking about their futures.”
With so much rationalisation in the industry, Devey says he is unconcerned about Towry being taken over.
“I’m not worried about it. My interests are to clients, colleagues and shareholders.”
He “would not rule anything out” and says he would have conversations with any firm.
Ashcourt Rowan provides wealth management and employee benefit consultancy services, and manages or has influence over £5bn in assets, of which £2.3bn is on a discretionary or managed basis. The firm has 340 staff and 16 offices in the UK.
Towry manages £6bn in assets and has 22,000 clients. It has around 800 employees from a national network of 20 offices.