AFH Enters Scottish Advice Market With Latest Acquisition

Stephen Little

29 July 2014

AFH Financial Group, a UK independent financial advisor and discretionary wealth manager, has completed its first acquisition since listing on AIM in June 2014 with the purchase of Edinburgh-based financial planning firm Finlay Gow & Company.

The initial consideration is for a cash payment upon completion of £337,500 , followed by a further cash consideration of up to £337,500 payable over the next 26 months, based on the performance of Finlay during that period, AFH said in a statement.

AFH said that the acquisition will immediately add £40 million in funds under management, bringing the company's total funds under management to £820 million and total advisor count to 127. Finlay Gow reported recurring revenues of £175,000 during the financial year ended 31 March 2013.

Upon completion, Finlay Gow's directors, Andrew Bandura and David Whigham, will join AFH as advisors.

The deal is the ninth completed by AFH since the implementation of the Retail Distribution Review, highlighting continued consolidation of the sector amid a changing regulatory landscape.

Since the implementation of the RDR at the beginning of last year, it has become increasingly expensive for advisors to service their clients, which has resulted in the growing number of mergers and acquisitions in recent months.

Earlier this year, AFH completed the acquisition of Stoke-On-Trent-based SR Wealth Management and Norwich-based IFA Omega Consulting.

"The last quarter has seen a significant level of activity at the company - a period which has included two successful capital raisings, the acquisition of the assets of Norwich-based Omega Consulting and the Company's admission to AIM,” said Alan Hudson, chief executive of AFH.

"This acquisition marks the significant and growing importance of the company's expansion strategy, increasing the firm's geographical presence across the UK," he added.