Axa, the life insurer, has confirmed it has signed the deal to buy financial adviser group Thinc Destini for £100m.
A statement issued by the firm reveals Axa intends to keep the distribution firm as a separate entity known as Advisory Services Limited, while the existing board of directors will remain in place and Simon Chamberlain will continue as chief executive.
The deal will see Axa pay up to £30m to repay the debt incurred largely by Thinc Destini's acquisition of IFA businesses as well as provide working capital to the group, while the remaining £70m is being paid to shareholder of Thinc Destini, providing certain financial performance targets for business are hit during 2009.
At the same time, Thinc Destini is being rebranded at the end of this month as Thinc Group, in an operational move separate to the Axa purchase.
A significant long-term incentivisation scheme has been put in place – the value of which is thought to dwarf and be worth at least double the purchase price – to retain directors, existing members and self-employed advisers, many of whom are already shareholders in Thinc Destini, while key directors are thought to be linked to a run-out period, which matures in 2009/10.
This is Axa's first such move to purchase IFA distribution so directors of Advisory Services Limited believe "it is a strategic priority for the AXA Group to strengthen its UK distribution platform and gain greater access to its customers" and "an acquisition of Thinc Destini fits with this strategy and will enhance the AXA Group’s position in the provision of financial advice and planning within the UK market".
Thinc Destini now has more than 650 advisers through its national multi-tie, IFA and network model multi-channel distribution, advising on approximately £3bn of funds under advice and procuring around £3bn in mortgages for customers in 2005.
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