Wealth manager Brewin Dolphin is set to be acquired by the Royal Bank of Canada in a deal valuing the business at £1.6bn.
The investment specialist, which has a network of offices around the UK and Ireland including a strong presence in Newcastle, has recommended an offer to shareholders by RBC Wealth Management (Jersey) Holdings Limited, a subsidiary of Royal Bank of Canada.
The two firms announced they have reached agreement on the terms of a recommended all cash offer, through which shareholders will be entitled to 515p per Brewin Dolphin share. The deal values Brewin Dolphin at 2.8% of its £55bn assets under management as of February 28 2022.
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In a stock market announcement the Brewin Dolphin directors said they have been advised by Barclays and Lazard as to the financial terms of the acquisition, and consider the terms to be fair and reasonable.
Royal Bank of Canada said it is strategically focused on opportunities to grow its wealth management operations in its core markets of Canada, the US and Europe and that the acquisition of Brewin Dolphin represents “an exciting strategic opportunity” for RBC to combine RBC WMI, its existing wealth business in the UK and the Channel Islands, with Brewin Dolphin to create a market leader with £64bn of assets under management.
It said the acquisition is transformational to RBC WMI in the UK, Ireland and Channel Islands and establishes an attractive platform for further growth.
With a heritage which traces back to 1762, originally as a provider of stock-broking services,
Brewin Dolphin manages £57bn for around 80,000 clients and has more than 2,000 employees across its office network.
Robin Beer, chief executive officer of Brewin Dolphin, said: “The Brewin Dolphin Board is pleased to recommend the offer by RBC in the interests of our shareholders, our clients, our people and our business partners.
“Building on the strong organic growth that we have achieved to date, the combined business will create an attractive platform for future growth. As part of RBC we would be able to provide our clients with a broader range of products and services, and expand our distribution channels through leveraging RBC’s global presence.
“We share complementary values which emphasise the importance of long-standing client relationships and an inclusive culture supportive of employees and local communities. Our focus will be on maintaining continuity, so that we build on what we have already achieved. I am looking forward to us working together to enhance our market position as a leading advice-focused, digitally enabled wealth manager.”
Doug Guzman, group head, RBC Wealth Management, RBC Insurance and RBC Investor & Treasury Services, said: “The UK is a key growth market for RBC, and Brewin Dolphin provides us with an exceptional platform to significantly transform our wealth management business in the region.
“Both management teams are excited by a shared vision of high quality client service, client-centric culture and the exceptional growth opportunities that we can deliver together.”
Brewin Dolphin’s largest office outside of London is in Newcastle, and it also has bases in Scotland, Wales, Ireland, Bath, Bristol, Cheltenham, Birmingham, London, Exeter, Leeds, Ipswich, Cambridge, Lincoln, Manchester, Marlborough, Nottingham, Plymouth, Truro, Tunbridge Wells and Shrewsbury.