27th Mar 2025 10:30
(Alliance News) - Retail investment platform provider AJ Bell PLC on Thursday said it has struck a deal to sell its Platinum business to fellow London-listing InvestAcc Group Ltd for up to GBP25.0 million.
The deal to sell AJ Bell Platinum, which provides pension arrangement services, includes GBP18.5 million in upfront. The upfront amount includes GBP17.5 million in cash and GBP1.0 million of new shares in pension administrator InvestAcc.
There also is a deferred GBP6.5 million cash consideration.
AJ Bell Platinum, which offers self-invested personal pension and small self-administered scheme products, has 3,600 customers with GBP3.2 billion of assets under administration. The customers and assets will transfer to InvestAcc.
"This is expected to happen in the second half of 2025. In the year ended 30 September 2024, AJ Bell Platinum contributed GBP10.0 million to non-platform revenue. The sale does not impact our FY25 guidance," AJ Bell said.
"On completion of the deal, a profit on disposal of up to GBP25.0 million less associated transaction costs will be recognised. The disposal proceeds will further strengthen AJ Bell's capital position, which will be flowed through the company's capital allocation framework."
InvestAcc Executive Chair Mark Hodges believes the AJ Bell SIPP and SSAS businesses are a "perfect strategic fit".
"This significantly strengthens our position as a market leader in 'full' SIPP pension administration, allowing us to enhance our service offering while maintaining the highest standards of customer experience. This represents the second acquisition of a wider pipeline of both company and client book extraction opportunities under active review.
"We look forward to collaborating with AJ Bell to ensure a seamless migration and integration of the Platinum SIPP and SSAS clients to our platform and to presenting the acquisition opportunity as part our investor roadshow following the publication of our accounts in April," Hodges added.
InvestAcc noted the AJ Bell Platinum offering serves the high net worth segment, explaining the average SIPP account size is around GBP670,000.
"It also enhances InvestAcc's existing relationships with financial advisers and wealth managers through expansion of product offering, as well as broadening overall advisor relationship market coverage," the firm added.
"The acquisition's Platinum SIPP and SSAS products are not actively marketed. This provides a significant opportunity to re-open marketing channels and leverage the acquisition's large network of financial advisers and wealth managers."
InvestAcc announced a GBP25.0 million "committed acquisition facility" secured from lender Kartesia to finance the deal and support "strategy in future". The initial interest rate margin is 6.75% per year but it expects this to ease to 6.00% in 2026 as it predicts its leverage ratio to fall.
Marwyn Value Investors Ltd noted the deal. Marwyn Value is managed by Marwyn Investment Management LLP.
"As part of the transaction, Marwyn Investment Management LLP, the manager of the Marwyn funds, has reinforced its long-term commitment to InvestAcc and its strategy by entering into a three-year lock-up agreement. Under the agreement, subject to limited exceptions, MIM has committed to retain a minimum holding of 12.4 million InvestAcc ordinary shares, representing 25% of InvestAcc's current share capital," Marwyn Value said.
MIM holds just under 60% of InvestAcc's shares.
AJ Bell shares were down 0.4% at 419.00 pence each in London on Thursday morning. Shares in the Marwyn Value and InvestAcc were untraded.
By Eric Cunha, Alliance News news editor
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