Deutsche Asset & Wealth Management, part of Deutsche Bank, has agreed to sell its Tilney wealth business in the UK, confirming weeks of speculation that a move was on the cards.

Confirming months of speculation that it was planning the move, Deutsche Asset & Wealth Management said today it has agreed to sell its UK regional business, Tilney, to a company controlled by the Permira funds.

The agreement means Tilney, founded in 1836, will be owned by the same structure that owns Bestinvest, the wealth advisory and investment firm that agreed to be bought in November last year. Deutsche Bank originally bought Tilney from private equity house Bridgepoint in December, 2006.

There have been reports in the media for months that the German-headquartered banking group was planning to dispose of Tilney; when asked about the matter by this publication, it has declined to comment about the matter. The deal is also an example of how there has been a flurry of M&A activity in the wealth industry in recent months. In some cases, the takeovers have been driven by a desire by some firms to achieve critical mass and scale amid rising regulatory costs. For others, the sales have been carried out to focus on specific business lines.

Tom Slocock, Head of Wealth Management in the UK for DeAWM, said: "Deutsche Asset & Wealth Management will continue to focus on providing wealth management services from our London office. We are expanding the range of high quality solutions we offer wealth management clients and their families,” Tom Slocock, head of wealth management in the UK for DeAWM, said in a statement.

The buyer will acquire the Tilney businesses in Birmingham, Edinburgh, Glasgow and Liverpool. The transaction is expected to be completed by the end of the second quarter of 2014. Financial terms were not disclosed.

Tilney will be combined with Bestinvest, which is also being acquired by the buyer, subject to completion of the transactions, the statement said.

Subject to regulatory approval of both acquisitions, Tilney and Bestinvest will be combined to create a leading standalone UK wealth manager with around £9 billion ($14.97 billion) of assets under management, advice and administration. The acquisition of the Tilney regional businesses is expected to complete in the second quarter of 2014, said a separate statement from Bestinvest.

“Tilney and Bestinvest are highly complementary businesses. The combined group will have a nationwide presence and service clients across the wealth spectrum, from self-directed investors utilising Bestinvest’s state-of-the-art online investment service through to high net worth individuals and their families requiring discretionary investment management and wealth planning,” Bestinvest said.

Tilney has £3.5 billion of assets managed or advised by its regional businesses, the majority of which are discretionary portfolios serviced by 58 relationship managers.

Following completion of the transaction and as part of the enlarged Bestinvest group, the respected Tilney brand will be re-introduced in the discretionary investment management market, complementing the strength of the Bestinvest brand.

Philip Muelder, Partner at Permira, said: “The UK wealth management industry has strong growth characteristics but is currently very fragmented. In combining Tilney and Bestinvest, we will bring together two highly regarded firms to create a truly market leading, UK-wide standalone wealth manager that will offer a broad and complementary range of services. The combined business will benefit from the advantages of increased scale and full national coverage and will be ideally positioned to capitalise on the opportunities that are emerging from recent regulatory changes.”