Rathbone acquires two private client businesses

Wealth manager Rathbone Brothers has acquired private client businesses from Jupiter Asset Management and Tilney Asset Management, boosting its assets under management.

Rathbone will pay £43.1 million for the Jupiter business, which has around £2.1 billion assets under management. In addition, it will purchase the Tilney business for £14.3 million, which manages £700 million. The acquisitions are part of Rathbone’s plan to grow its share of the private banking market in the UK.

In order to fund the deals, as well as potential deals in the future, Rathbone raised £24.4 million through a share placing.

Philip Howell, chief executive of Rathbone, said, “We expect to see more acquisition opportunities in the private client industry in the short and medium term. Raising capital now will give us flexibility to continue to take advantage of similar opportunities as they arise.”

The wealth management industry as a whole is consolidating whilst banks and asset managers are selling off non-core private banking operations in a bid to streamline.

Rathbone caters for ethical investors and manages over £640 million in ethical investment assets.

At the beginning of the week the Jupiter Responsible Income fund was removed from the Investment Managers Association (IMA) UK Equity sector after failing the three-year yield requirement. The fund has now been moved into the IMA UK All Companies Sector.

In order to qualify in the IMA UK Equity Income sector, funds need to average at least 110% of the FTSE All Share index yield in the past three years.

Photo: Mike Johnson via sxc.hu

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The Guide to Sustainable Funds 2013