Embark Group has today announced the acquisition of Charles Stanley's pension business, EBS Management, in an initial £2m deal that takes the retirement solutions provider's assets under administration (AUA) to £10.96bn.
The acquisition - approved by the UK Takeover Panel but conditional on final approval from the Financial Conduct Authority, which the group expects shortly - leaves Embark as the 100% owner of EBS, including its wholly-owned subsidiaries Alpha Trustees, EBS Pensioneer Trustees and EBS Self-Administered Personal Pension Plan Trustees.
"This is the latest step in building the scale of our business," said Embark Group CEO Phil Smith (pictured). "EBS represents one of very few remaining ‘scale' transactions in the fast-consolidating SIPP and SSAS sector of UK financial services."
Charles Stanley and Embark will become ongoing partners for SIPP and SSAS services to Charles Stanley clients, Smith said, adding: "Following the change of ownership, EBS will continue to operate and administer SIPP products exclusively for Charles Stanley, distributed through both its advised and execution only channels, and through Bestinvest."
Smith explained EBS would be retained as a subsidiary of the group - "operating independently but sharing significant common infrastructure benefits and accessing capital support over time". All of the existing EBS staff, based in London, are to remain in place following the sale, led by director Kate Ragnauth, who will continue as principal of the business and join Embark's executive team.
Describing the acquisition as "a sweetheart deal", Smith said: "We have a strong focus on investment in people across all of our businesses and EBS staff were always aware of what we were doing and there will be no job losses. Charles Stanley will keep continuity while their clients will see no disruption, will benefit from ongoing technological improvements and will also have the certainty we will not touch pricing for three years.
"At the same time, Embark not only adds scale and leverage to the business, we also have two major distribution partners in Charles Stanley and Bestinvest. This is part acquisition but also a multi-year ongoing partnership to manufacture SIPP and SSAS products. The deal offers excellent value to us and, with our digital and technical capabilities, EBS will trade profitably going forward."
Charles Stanley CEO Paul Abberley said: "We are delighted with this transaction. It is simultaneously right for all stakeholders of the EBS business - present and future - and, most importantly the underlying consumers. We look forward to a long commercial partnership with the team at Embark."
The enlarged Embark Group, which acquired The Adviser Centre last October and DFM platform Discus last month, will now employ more than 500 people and serve more than 100,000 underlying consumer clients, representing £10.96bn of assets, across its SIPP, SSAS, ISA, GIA, financial planning and corporate business activities.
'Can help iron out rough edges'
How do mergers affect investors?
Our video series continues
Three advisers have their say…
Regulator's data bulletin