Permira Completes Bestinvest Acquisition

Mark Shapland

1 April 2014

Private equity house Permira has completed the acquisition of Bestinvest as it looks to bolster its position in the UK wealth management space.

Permira said the industry remains fragmented with a long tail of subscale firms that manage under £3billion of client assets.

“Bestinvest is an excellent, award-winning business with a strong management team whom we are delighted to back,” said Philip Muelder, partner in the financial services team. “The UK wealth management industry has strong organic growth characteristics but it also remains fragmented which presents consolidation opportunities.”

Permira also bought Deutsche Bank's wealth management arm, Tilney, last month. Tilney will be merged with Bestinvest to create a wealth manager with £9 billion ($15 billion) of assets.

“The recently announced intention to acquire and combine the regional business of Tilney with Bestinvest will propel the group to become a truly nationwide standalone wealth manager with £9 billion under management that will service clients across the wealth spectrum whether they want to make their own investment decisions, benefit from a trusted adviser or for us to manage a portfolio for them,” said Peter Hall, chief executive of Bestinvest.

Bestinvest, which has around £5 billion of funds under management, was acquired by 3i in August 2007. Earlier this year Bestinvest was ranked Britain's top investment platform – or online shop for shares and funds – according to authoritative research conducted by a specialist consultancy Platforum.

Tilney, founded in 1836 as RJ Tilney & Co, has been largely loss-making since Deutsche acquired it in October 2006 for £300 million. Due to the problems in the UK property market and the decline in private client assets, Deutsche is likely to face a significant write-down on its acquisition.

Since then the asset and wealth management business posted a £9.5 million pre-tax loss in 2012, following a £8.9 million loss in 2011.