By Pablo Mayo Cerqueiro, Emma-Victoria Farr and Amy-Jo Crowley
LONDON/FRANKFURT(Reuters) – Brooks Macdonald is working with a defence adviser on its strategy amid takeover interest, three people familiar with the matter told Reuters.
The British wealth manager, which oversees close to 17 billion pounds in client assets, has lined up investment bank Raymond James, said the people, who spoke on condition of anonymity.
Raymond James has had a longer-term mandate for financial advice which recently developed into defence strategy, one of the people said.
It is unclear whether any approaches have been made.
Brooks Macdonald and Raymond James declined to comment.
Shares in Brooks Macdonald have dipped since peaking in late 2021 as market conditions soured. They are down almost 25% this year even as the company posted client asset gains, giving it a market cap of less than 300 million pounds.
Including debt, the company trades at about 6 times its earnings before interest, tax, depreciation and amortisation (EBITDA), according to LSEG data, lower than some other wealth managers.
Britain’s fragmented wealth management industry has seen increased consolidation in recent years driven by both private equity and strategic players.
This has led to a number of London-listed firms being taken private, such as Charles Stanley and Brewin Dolphin.
Led by chief executive Andrew Shepherd, London-based Brooks Macdonald offers financial planning and investment management services to high-net-worth individuals, as well as pension funds, institutions and trusts.
The group posted increases in both revenue and assets under management for the 12 months to June 30, but cost pressures weighed on profit, according to its latest annual results.
Client assets grew further in the following three months thanks to investment performance, offsetting client outflows in its UK funds business.
(Reporting by Pablo Mayo Cerqueiro, Emma-Victoria Farr and Amy-Jo Crowley. Editing by Anousha Sakoui, Kirsten Donovan)
