Towry locked in four-way bid battle 22 January 2016

Towry locked in four-way bid battle

Four firms are embroiled in a fight to acquire wealth management firm Towry.  Towry was put up for sale before Christmas by its private equity owner Palamon Capital Partners after plans to float the business were abandoned.  Palamon hired Evercore to find a suitable buyer for the firm, which have been valued at £600 million.

It is understood that after the first round of bids, four potential suitors have been selected as the process enters its second round.  It is believed all four firms are from a private equity background.  Private equity firms have been increasingly active in the wealth management space after the revolution in UK pensions created a big opportunity for the sector.

One of the most active players has been Permira, which has bought Bestinvest and Tilney in the last two years.

Other big deals to go through recently include private equity investment trust Caledonia’s £100 million acquisition of Seven Investment Management.  The Towry deal is likely to trigger a fresh wave of consolidation across the wealth management industry, with AXA also believed to be plotting the sale of its wealth business.   

Over the last few years Towry, headed by former Wealth Managercover star Rob Devey has been linked with a listing on the stockmarket.

In 2010 the firm hired advisers to manage a potential listing on the FTSE 250 but plans were put on ice at the start of 2012, which the group's then chief executive Andrew Fisher attributed to market turbulence.  

The following year Fisher said float plans had been shelved after the firm raised £35 million to help fund growth through acquisition. The investment was made by two Palamon co-investors AlpInvest Partners BV and Honeywell Capital Management.

The money fuelled an acquisition spree at Towry, which saw it swoop on accountancy firm Baker Tilly’s private client business in a £51 million deal and fellow wealth firm Ashcourt Rowan, for whichit paid £97 million. It also bought Bluefin Personal Consulting from AXA UK for an undisclosed sum.