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Millfield bases multi-tie on Inter-Alliance

Inter-Alliance advisers will move into Millfield’s multitie once depolarisation begins, according to Millfield’s stockbroker Collins Stewart.

A research note from Coll-ins Stewart written by analyst Tim Young reveals that Inter-Alliance advisers will form the basis of Millfield’s multi-tie.

Young says that as many Inter-Alliance advisers came from direct salesforces, it is closer to a multi-tie operation than the typical IFA and therefore well positioned to capture incremental sales resulting from the arrival of multi-ties after depolarisation.

He says the combined group will have a multi-tied arm of 1,000 advisers by December 2005, absorbing most of the advisers from Inter-Alliance, and says it will have more than 1,850 advisers in total.

Young predicts that Mill-field will move into profit in 2006. He says the combined group is likely to make a loss of £9m in 2005 but forecasts £4m of profit before tax for the year to March 31, 2006 and £17m in the year to March 31, 2007.

Young writes: “Inter-Alli-ance has more advisers but lower productivity per adviser and will form the basis of the combined group’s multi-tied distribution channel.”

Millfield finance director Harry Roome says: “Our multitie plans are moving along as we speak. With the FSA yet to publish final rules, it is not yet clear exactly how a multi-tie arrangement will work but we understand that advisers will be able to act as multi-ties for some clients and IFAs for others.

“A lot of the business written by advisers in Inter-All-iance is suitable for multi-tie but IFAs will be able to choose which route they go down.”

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