Intrinsic pulls out of Tenet bid

Mike O'Brien 2

Intrinsic has pulled out of a deal to buy network Tenet after months of deliberation, Money Marketing can reveal.

The Old Mutual-owned network called time on the talks because a price could not be agreed upon and there were concerns the acquisition itself would take too long to complete.

It is understood the impending break-up of the Old Mutual group did not contribute to the decision.

A potential deal for the network has been on the table since at least May 2015 when Money Marketing revealed Aviva wanted to sell its shareholding.

Tenet is currently owned by Aviva, Standard Life and Aegon, with the Norwich-based provider holding the largest stake in the firm following its acquisition of fellow shareholder of Friends Life.

Aviva holds a 47 per cent stake, while Standard Life owns 25 per cent, and Aegon owns 22 per cent, with the remainder held by independent shareholders.

Aside from Intrinsic, it emerged that private equity group Permira – which acquired and merged wealth managers Tilney and BestInvest in 2014 and Towry in 2016 – has discussed buying Aviva’s stake and the 6 per cent held by minority shareholders.

Former directors of Tenet member advice firms were given shares as parts of acquisition deals over the years. However, it is understood the group has never been paid a dividend and are keen to sell their shares.

A deal would give Permira a majority of shares over Standard Life and Aegon.

It understood Standard Life was strongly against a sale to Old Mutual because of concerns assets would follow the network to the rival provider.

Last month it was revealed Old Mutual is planning to float its UK wealth division in 2017 while US asset management business Old Mutual Asset Management is reportedly close to a sale to New York-listed Affiliated Managers Group.

Figures published in January 2016 show turnover at Tenet increased by 9 per cent to £136m in 2015, while earnings grew by 15 per cent to £1.5m as it recorded a pre-tax profit of £471,952 for the year to 30 September 2015, up 32 per cent on 2014.

The group’s mortgage and protection business TenetLime saw a 48 per cent increase in turnover while the appointed representative business TenetConnect increased the number of advisers on its book by 5 per cent.

Intrinsic and Tenet declined to comment.