The UK-listed wealth management house has agreed to sell part of its operations, an execution-only operation based in Edinburgh.
London-listed wealth management and investment firm Brewin Dolphin has sold its Scottish execution-only division, Stocktrade, to Alliance Trust Savings for £14 million ($22 million) in cash.
The transaction will be paid in full when the deal is complete, Brewin Dolphin said in a statement today.
Based in Edinburgh, Stocktrade had £4.31 billion of assets under administration as at 28 September last year; for the year ending on the same date it had income of £9.6 million and contributed around £1.3 million of pre-tax profit. The Brewin Dolphin Group as a whole manages £29.6 billion of funds, of which £24.8 billion is on a discretionary basis.
After accounting for all related costs, the transaction is expected to result in a net gain of approximately £1.0 million, subject to final separation costs. The net sale proceeds will be used for general corporate purposes, Brewin Dolphin said, adding that the sale will “enable additional operational efficiencies that, over time, are anticipated to largely offset Stocktrade's contribution”.
The divisional directors responsible for Stocktrade, Graham Swan and Nicholas Pearson, will stay with the business in senior management roles. The existing Stocktrade team in Edinburgh will be transferring across to ATS upon completion of the transaction, it said.
Completion is conditional upon regulatory conditions customary for this type of transaction and is expected to occur in 2015.