AnaCap could explore Wealthtime sale in 12 months

Explorations are likely to start in 2H23 with a view to completing a transaction in 2024, one of the sources said, provided that a pre-emptive offer does not emerge.

The timeline could be brought forward, one of the sources suggested, although the other two indicated that seems premature as things stand.

The group, which resulted from the amalgamation of three different businesses, needs time to grow its EBITDA from the low double digits to close to GBP 20m by the time of a sale, two of the sources said. It is also working on further integrating its existing operations and looking at potential bolt-on acquisitions, one of them added.

London-based AnaCap, which focuses on the European financials midmarket, acquired Wealthtime in 2020 as its first venture into the UK wealth management space. It subsequently bought peers Amber Financial and Novia, which are now moving under the Wealthtime brand.

AnaCap declined to comment. Wealthtime did not return a request for comment, while Novia said the business is not for sale.

Last year, AnaCap secured GBP 55m in unitranche financing from HIG WhiteHorse, a credit affiliate of HIG Capital, to support its ambitions for the sector, including add-on M&A.

The UK's fragmented wealth management industry has been flooded with M&A activity in recent years, fuelled by private capital funds looking to implement buy-and-build strategies, as reported.

While the distribution of investment products in continental Europe is often dominated by banks, the UK has a sizeable community of independent financial advisers and, alongside it, a whole set of businesses offering support and technology services to IFAs.

Wealthtime could potentially catch the eye of private equity-backed Nucleus, one source said, though the different technology systems used by each party might undermine the rationale for a tie-up. Nucleus is expected to go on the market for bolt-on M&A once a majority investment from HPS closes later in the year, this source added.

A spokesperson for Nucleus declined to comment.

Earlier this year, Nordic Capital signed a deal to acquire IFA consolidator Ascot Lloyd from Oaktree Capital Management, with a commitment to support the target's M&A strategy.

The Wealthtime group, led by Patrick Mills, offers digital tools and access to investment products to financial advisers and their clients. It also has a discretionary fund management operation called Copia Capital.

The group oversaw north of GBP 11.8bn assets under administration from more than 77,000 clients as of end-March, according to a press release.

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• Topics
• Exits
• Financing
• UK / Ireland
• AnaCap Financial Partners
• Mergermarket