Wed, 27 Jul 2022 | BUSINESS SALE
Financial services provider STM Group has agreed to acquire the trustee companies, net assets and portfolio of Mercer’s self-invested personal pensions (SIPPs) and self-administered pension schemes (SSASs) in a deal worth £3.34 million.
The acquisition, which comes amid growing M&A activity in the UK pensions sector, will add around 2,100 SIPPs and 700 SSASs to STM’s UK pensions operation and see it double the revenue of its UK personal pensions division, Options UK. The division will also gain access to Mercer’s network of intermediaries.
The deal is expected to close around August 31 2022. As STM is not buying the regulated entities themselves, the deal is not subject to regulatory approval. However, the Financial Conduct Authority (FCA) has been kept informed throughout the process.
STM will fund the acquisition through existing financial resources, as well as the remaining available debt facility it had previously arranged with its bank. Post-acquisition, STM will retain Mercer’s existing staff, as well as its Cardiff premises.
Commenting on the deal, STM CEO Alan Kentish said: “We are delighted that Mercer has chosen STM as the new home for its Sipp and Ssas business, previously acquired as part of its own acquisition of JLT. Both ourselves and Mercer are committed to ensuring a seamless transition for clients, intermediaries, staff and other stakeholders.”
“The revenue generated by this portfolio will mean that our Options personal pension solution business in the UK will effectively double in size and will give us a new centre of excellence for our Ssas business.”
Kentish added: “The Sipp marketplace continues to see change and out of this comes opportunity to differentiate our proposition. Unlike most Sipp providers, STM also has a UK workplace pension solution and this in itself allows us to offer a full suite of retirement savings options to anyone, no matter where they are within their career path.”
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This established IFA is assigned to one major platform ensuring a very smooth transition of client assets.
This is a highly profitable business with EBIT percentage of 33%, meaning money can be recouped quickly after a purchase.
With advisers and back-office staff in place, this business can be purchased and will keep running efficiently.
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