Palatine sells Wren Sterling in Lightyear-backed MBO

Financial terms were not disclosed. The deal is subject to FCA approval.

Lightyear is a New York-based private equity firm that specialises in financial services business. The GP will take a majority stake in Wren Sterling, with management holding onto the remainder.

Wren Sterling was created in 2015 through the Palatine-backed GBP 8.64m management buyout of Towergate Financial, the IFA arm of insurance broker Towergate. Since then, the GP said Wren Sterling has seen "strong growth", with assets under management increasing to £4.6bn and profitability also improving.

Wren Sterling completed eight bolt-on acquisitions during the investment period, including four in 2021, expanding its presence to seven offices across the UK.

The deal is the second exit for Palatine in 2021 so far, following the sale of its shareholding in road safety training provider TTC to its management team and Pricoa Private Capital in May. On the buy-side, Palatine has completed four investments in 2021 with the acquisitions of stakes in Anthesis, FourNet, Routes Healthcare, and TranScrip across its buyout and impact funds.

The GP held a final close for its fourth fund on £220m in May 2021.

Company
Created in 2015, Wren Sterling is a national group of independent financial planners with seven UK offices and more than GBP 4.6bn in assets under advice.

The company advises individuals and businesses on every aspect of financial planning, including pensions, investments, protection, estate planning and employee benefits.

Turnover in the year to 31 March 2020 reached GBP 20m with EBITDA of GBP 1.8m, according to publicly available documents.

People
Palatine Private Equity – Andy Strickland (senior investment director).

Advisers
Vendor – Houlihan Lokey (M&A); Gateley (legal); Clearwater International (debt advisory); Deloitte (financial due diligence); Thistle (compliance due diligence).
Management – Liberty (corporate finance); Pitmans (legal).

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• Topics
• Exits
• Buyouts
• Financials
• UK / Ireland
• Palatine Private Equity
• Secondary buyout