James Hay parent IFG Group has reached a sale agreement with private equity firm Epiris that will see the firm valued at £206m.
IFG, which also owns national advice business Saunderson House, will sell its entire share capital to Epiris.
IFG shareholders will each be entitled to £1.93 in cash per share – a 46 per cent premium on IFG’s share price last week.
The £206m valuation puts the deal at a multiple of around 21 times IFG’s adjusted post-tax earnings last year.
IFG chief executive Kathryn Purves says: “The offer by Epiris represents a compelling opportunity for shareholders to realise an immediate and attractive cash value for their shareholding in IFG today. In addition, our employees and clients will benefit under the ownership of Epiris which should help accelerate the delivery of IFG’s strategic objectives and the underlying strategies of James Hay and Saunderson House.”
Before the deal goes through, it must be approved by IFG shareholders and receive regulatory and legal approval.
The board of IFG will be recommending shareholders back the deal at an upcoming meeting.
Epiris partner Owen Wilson says: “We are delighted that the board of IFG has recommended our offer and we are excited to work with management to realise the growth potential of James Hay and of Saunderson House and to further enhance their position in their respective markets. James Hay, a trusted provider in the Sipp market, and Saunderson House, a differentiated independent wealth manager, both have strong reputations across their broad range of clients”.