Acquisition
16 December 2021
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Fairstone
This acquisition by the full-service wealth management house, further highlights the strength of Fairstone’s unique proprietary Downstream Buy Out (DBO) acquisition model which integrates ambitious IFA firms into the group, typically over a two-year period, prior to final acquisition. The focus of Fairstone’s approach is to attract businesses that do not want to sell today, instead targeting robust and well-managed firms that want to grow and develop, therefore crystallising a higher overall valuation in the future.
Significantly, the vast majority of companies that have successfully reached ultimate acquisition stage demonstrate continued organic growth and a higher valuation than expected at the outset of the journey, with firms commonly exceeding their original aspirational sale value.
Based in Romsey, Cube Financial Planning is a whole-of-market advice firm specialising in advice and management of investment and retirement portfolios.
The acquisition brings an additional 153 clients into the group together with Cube Financial Planning’s two advisers and one support staff. The acquisition also secures gross fee income of £800,000 for Fairstone together with funds under management of more than £150 million.
Commenting on the deal, Lee Hartley, CEO of Fairstone, said: “We are delighted to complete the final acquisition of Cube Financial Planning, having worked closely with them throughout the integration phase.
“The team are a strong cultural fit for Fairstone, with high quality individuals who really care and put clients at the heart of what they do.
“Within Fairstone, we work hard to ensure our proposition gives firms the framework they need to significantly grow their businesses, without compromising on client service or independence. Finalising this deal with Cube marks a valued addition to our group and continues our scheduled growth plan for 2020.”
Company principals at Cube Financial Planning, Mike Godfrey and Neil Emburey, explained that a major factor in the firm joining Fairstone was to enable the team to focus their energy on clients, while Fairstone handled the operational, regulatory and administrative aspects.
Mr Godfrey added: “Continuing to deliver a first-class service to our clients, whilst coping with the challenges of ever-increasing regulatory change, is a key priority for us, so joining forces with one of the largest Chartered financial planning firms in the UK makes very good sense.
“It was clear from very early on in our discussions with Fairstone that our client-focused approach and business values are very much in tune with those of Fairstone.
“The quality, strength and depth of the Fairstone organisation combined with their unique Downstream Buy Out acquisition model ensures that we can continue to deliver excellent client service under the umbrella of the Fairstone Group.”
Further supporting Fairstone’s measured growth plan, eight firms have joined its unique DBO programme so far this year, bringing more than £1.2bn in funds under management to the wider business. Fairstone is also on track to announce a number of additional deals before the turn of the year.
Lee Hartley added: “I can say with confidence that Fairstone remains in a superb position to deliver continued growth throughout this year and far beyond. Our strategy is the exact opposite of the traditional ‘consolidator’ model and our underlying numbers – from client satisfaction and client retention through to earn-out performance – fully back this up.”
Headquartered in Newcastle, Fairstone is the number one ranked wealth management firm on Trustpilot* with over 69,000 clients and operates nationally across 42 locations.
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