Leading IFA Bates Investment Services is selling a third of its business to an investor consortium in a multi-million-pound deal designed to propel the firm into the top 20 of UK distributors.
Following 18 months of negotiations, Asset Strategies – an institutionally backed cash shell created to invest in IFAs – is taking a 33 per cent stake in a move which will see its chief executive Sean Ewing become Bates' non-executive chairman.
Director Graham Bates, who founded the firm with his sister Helen in 1993, becomes chief executive. He intends to use the cash to invest in the back-office systems and grow the business substantially before a planned flotation next year.
He says the decision to strike a deal with Ewing – who is also FundsDirect's chief executive – stemmed from Ewing's intention to work with an ambitious IFA looking to encourage continued growth and the creation of value for staff and clients.
Bates says: “We had many different approaches over the last two years. Our wish was to capitalise on what we have built and to work with a company who can help us in becoming one of the biggest businesses in quality of advice and earnings.”
Ewing says: “We looked at around 20 businesses. Bates had a good understanding of where a modern IFA needs to be and has been positioning itself to be a leading company.”