Acquisitive wealth manager Bellpenny has bought Glasgow-based financial adviser Reid, Scott & Ross, adding £108 million of funds to its books.
It marks the group’s third acquisition in Glasgow. Chief executive Kevin Ronaldson said he planned to bring the groups together in a single office.
Ronaldson told The Scotsman that Bellpenny – set up in October 2012 and backed by global investment manager Oaktree – would also like to buy into the Edinburgh market.
He said: “We didn’t particularly set out to buy businesses in Glasgow but it’s been a very productive place for us, there are some great businesses there.
“We are not currently in contact with any firms in Edinburgh who are thinking of doing a similar thing [as Reid, Scott & Ross] but we are still on the acquisition trail and will remain so for the foreseeable future. We are looking to expand in Scotland, along the M8 to Edinburgh and beyond.
“We are very well funded and capitalised.”
Reid, Scott & Ross was Bellpenny’s 22nd acquisition, adding a further 1,000 active clients as it snaps up independent financial advisers (IFAs) in a consolidation spree funded by Oaktree.
Reid, Scott & Ross was co-owned by Tony Ross & Paul Angell, who indicated that Bellpenny has mastered the art of buying IFAs and updating their business models to reflect sweeping changes imposed on the industry by the UK government’s recent retail distribution review (RDR).
In a joint statement, they said: “It’s easy to see why Bellpenny is proving to be the acquirer of choice for so many IFA businesses, both north and south of the Border.
“They’ve taken full advantage of the opportunity to build a post-RDR business from first principles, with the client right at its heart.
“And from an IFA owner’s perspective, the whole process of selling the business, from initial contact through to signing on the dotted line, is a well-oiled machine.”
Bellpenny now has some £2.6 billion of funds under management, and is bringing all its acquisitions under its own brand.
On 5 August it added about £900m in a single deal when it bought Torquil Clark, the wealth management arm of Skipton Building Society.
The firm provides a range of support services to the IFAs from its Reading base, but Ronaldson indicated that its growing Glasgow presence means it may choose to locate some of those jobs in the Scottish city once it finds suitable premises.
Last year Bellpenny bought Glasgow firms KM Financial Advisers and MGW, and its headcount in the city stands at around 30.
Ronaldson said the company never discloses the amount paid for its acquisitions, nor would he say how much the firm has spent on its spree to date.
“Everything is priced on an individual basis,” he said.
Ronaldson set up Bellpenny with an eye on the disruption RDR would cause in the financial advice industry. He has said in the past that he planned to reach £5bn in assets under management within five to seven years, at which point he would look for an exit strategy.
His backer, California-based Oaktree, has is an “alternative investments” specialist with $91.1bn (about £54.8bn) under management.