# Rathbones snaps up Investec’s UK wealth arm in all-share deal Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2023-04-04 Category: NEWS Category URL: https://financedigest.com/category/news Meta Title: Rathbones Acquires Investec UK Wealth Business for £839M Meta Description: British asset manager Rathbones to buy Investec's UK wealth unit, aiming to create a leading franchise in UK wealth management with 100 billion pounds in URL: https://financedigest.com/rathbones-snaps-up-investecs-uk-wealth-arm-in-all-share-dealhtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/2023-04-04t085717z1lynxmpej3309wrtroptp3britain-dailylife-1736814197569-compressed.jpg) By Simon Jessop, Iain Withers and Andres Gonzalez LONDON (Reuters) -British asset manager Rathbones said on Tuesday it had agreed to acquire the UK wealth business of [Investec](https://www.financedigest.com/strong-performance-of-investec-lowes-structured-product-maturities.html) in an all-share deal that values the unit at 839 million pounds ($1.04 billion). The tie-up is the latest in a string of deals in the high-growth sector as firms look to scale up in the face of higher regulatory and technical costs. Rathbones CEO Paul Stockton said the [sector was “ripe for consolidation”, adding that recent volatility in the wider financial sector – including](https://www.financedigest.com/citi-pledges-to-cut-emissions-for-more-sectors-including-coal.html "Citi pledges to cut emissions for more sectors including coal") the failure of some U.S. regional lenders and the emergency rescue of giant [wealth manager](https://www.financedigest.com/wealth-management-consultant.html "Wealth management consultant") Credit Suisse – could present opportunities. “There’s inevitably been a little bit of a flight to quality in some areas in the UK,” Stockton said on a media call, adding the movements had not been material for either business so far. “If we can attract flows on the back of our reputation, brand and combination, then of course we will.” Investors reacted positively to the deal, which will create a [wealth manager with approximately 100 billion pounds of funds](https://www.financedigest.com/norway-wealth-fund-employee-sues-for-workplace-gender-discrimination.html "Norway wealth fund employee sues for workplace gender discrimination") under management. Rathbones [shares were up 2% in early trading](https://www.financedigest.com/social-trading-is-the-new-way-that-gen-z-are-getting-their-share-of-the-pie.html "Social Trading is The New Way That Gen Z Are Getting Their Share of The Pie"), while London-listed shares in [Investec](https://www.financedigest.com/strong-performance-of-investec-lowes-structured-product-maturities.html) were up 3%. The bigger you are, the better you can invest,” Investec CEO Fani Titi said on a media call, adding that the bigger business would be able to better [attract talent](https://www.financedigest.com/cobots-in-the-financial-workplace-reducing-costs-attracting-talent-and-enhancing-sustainability.html "Cobots in the financial workplace: Reducing costs, attracting talent and enhancing sustainability") and operate efficiently. Under the terms of the deal, which excludes Investec’s Swiss and International [wealth](https://www.financedigest.com/hsbc-adds-over-300-to-china-headcount-after-citi-wealth-acquisition.html) operations, Rathbones [shareholders will own 58.75% of the combined group and hold 70.1% of the voting](https://www.financedigest.com/hsbc-board-recommends-shareholders-vote-against-spin-off-resolution.html "HSBC board recommends shareholders vote against spin-off resolution") rights. Investec will hold a 41.25% [stake in the combined firm](https://www.financedigest.com/stellantis-to-build-u-s-firm-archers-air-taxi-up-stake.html "Stellantis to build U.S. firm Archer’s air taxi, up stake") – with voting rights limited to 29.9% – and enter into a long-term strategic partnership with Rathbones. We see this as an ambitious but logical step for Rathbones to help secure its position as one of the leading franchises in UK [wealth management,”](https://www.financedigest.com/analysis-credit-suisse-collapse-threatens-switzerlands-wealth-management-crown.html "Analysis-Credit Suisse collapse threatens Switzerland’s wealth management crown") analysts at RBC said in a note. The companies said they would target annual savings of at least 60 million pounds, and the [deal was expected to be accretive to underlying earnings per share](https://www.financedigest.com/u-s-mid-tier-lenders-shares-rise-in-frankfurt-after-svb-deal.html "U.S. mid-tier lenders shares rise in Frankfurt after SVB deal") in its first year. Investec [CEO Titi said the combination would entail job](https://www.financedigest.com/amazon-ceo-says-job-cuts-to-exceed-18000-roles.html "Amazon CEO says job cuts to exceed 18,000 roles") losses, but that the management team would try to keep these to a minimum. Rathbones aims to achieve a double-digit post-tax return on [invested capital in the third full](https://www.financedigest.com/sainsburys-pays-524-million-for-full-ownership-of-store-investment-vehicles.html "Sainsbury’s pays 4 million for full ownership of store investment vehicles") year following completion. The deal, subject to regulatory approvals, is expected to be completed in the last quarter of 2023. ($1 = 0.8064 pounds) (Reporting by Simon Jessop, Iain Withers and Andres Gonzalez; editing by Louise Heavens and Jason Neely) --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---