The journey to selling, purchasing or retiring from an IFA business

by | Sep 6, 2023

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Bringing you a summary of some of the key takeaways from the latest IFA Magazine webinar, where a panel of experts delve into the challenging world of exit strategies in financial advice and wealth management businesses.

Earlier this summer, IFA Magazine hosted an in-depth discussion about the journey to selling, purchasing, or retiring from an IFA business in a webinar featuring some of the biggest players in the game.

Hosted by IFA Magazine’s Managing Partner, Alex Sullivan, merger & acquisition heavyweights, Daniel Bisby, Keith Brown, Paul Morrish and Julian Brincat formed a very worthy panel of experts. They tackled a range of topics relevant to advisers and wealth managers, including the current M&A market, management buy-outs and buy ins and joint ventures. This included answering questions such as ‘Who really ends up paying for the firm you buy?’ and ‘How long should I be required to purchase run off cover for and is this a regulatory requirement?’

 
 

The discussion began with four individual presentations from our key panellists. These were each followed by a Q&A in which IFA Magazine readers were given the opportunity to ask for their advice for their own situation or present a general question on the topics being discussed.

In what was a thoroughly engaging 90-minutes, the highlight of the webinar was, without doubt, the number of incoming questions provided by our audience. Each guest had numerous questions directed towards them. The collaboration between the whole panel to answer each one effectively was both interesting and insightful.

Towards the end of the webinar, IFA Magazine managing director, Alex Sullivan said: “We have rarely seen such strong engagement and interaction with our webinar viewers. We often do these events and always receive a healthy number of questions throughout from our IFA Magazine audience. However, the response to this particular webinar was like nothing we have ever had. The total engagement of the entire audience is entirely down to the fantastic presentations that all our guests gave, so l’d like to extend a big thank you to our panellists and viewers alike.”

 

The views from the top

IFA Magazine was very fortunate to welcome Daniel Bisby, Keith Brown, Paul Morrish and Julian Brincat as guests on to the M&A webinar. All four guests have enjoyed esteemed careers in the M&A space and were able to give insight that very few are able to provide.

As part of the webinar, each guest was given 15-20 minutes to deliver a short presentation about their specialism within the M&A space.

 

Our first presentation came from Paul Morrish, founder of Succession Wealth.

Paul developed his M&A experience leading on two major acquisitions as part of his director role at Barclays, and subsequently as a consultant leading on business merger, demerger, acquisition and growth activity, including work for Tesco/ RBS, and also several regional in-market transactions.

Paul kicked off proceedings with a discussion on the ever-changing M&A marketplace.

 

He said: “The market for selling and buying IFA businesses in the UK has been consistently buoyant over many years now. But what is it that has made IFAs so attractive for buyers, and will those factors continue into the future? What is the consolidator market really all about, and why are there signs that things are already changing?

He continued “Market change is definitely happening and it’s important to understand why that is and what sellers can do to still make the sorts of returns we have seen in recent years. To do this requires a knowledge of what buyers look for and how they make their money after an acquisition.”

A PI perspective on M&A

 

Julian Brincat, specialist IFA PII broker and director at Protean Risk Ltd, followed on from Paul Morrish with a presentation on merger & acquisitions from a PI perspective.

Julian has over 15 ears of specialist IFA PIl knowledge focusing on firms of all sizes including larger national firms and networks and is experienced in advising firms on both sides of mergers and acquisitions so he was the perfect guest to discuss these topics.

He said: “There is a lot of M&A activity in the IFA market at the moment and as a specialist IFA PI broker, Protean Risk is very active in dealing with clients on both sides of an acquisition. Having been through the process ourselves, being acquired by Aston Lark in 2019, we have a strong. first-hand expertise to otter our clients.

 

“The way that PII interacts with any potential deal, including how the previous liability is managed is evidently one of the focus areas of negotiations and it is clear to us that many firms would benefit from a better understanding of their PII provisions post deal. We hope that if advisers on both sides of any potential M&A deal take anything from this webinar, it will be a better understanding how run off cover works.”

Julian went on to give a number of examples of projects that he had worked on and even gave some answers to audience questions on what he thought the viewers should do in their specific case.

A ‘whistlestop tour’ of a transaction

The third presentation of the morning came from Daniel Bisby, Partner at Schofield Sweeney Solicitors.

Daniel’s specialisms include acquisitions and disposals (shares and assets), management buyouts and buy-ins, joint ventures, shareholder and partnership agreements, investment agreements, refinancing (including banking work) and reorganisations.

In his presentation, Daniel highlighted some of the issues that are often overlooked by advisers when they come to buy, sell or retire from a business by giving a ‘whistlestop tour’ of a transaction.

He said: “At Schofield Sweeney we act for both sellers and acquirers, it is probably a 70/30 split with the majority being sellers. Already so far, we have seen the different approaches that can be taken within the market, but we’ve found that there are always some themes that crop up across the majority of transactions and I was very interested to cover those in the webinar.”

“The three main themes started with looking at the difference between selling shares and selling assets from a liability point of view. That then led us down the path of the two biggest headlines of my presentation which were indemnities and warranties.”

“Finally, I touched upon the things that often people don’t think about, the things that regularly cause delay.”

Daniel’s discussion gave a fascinating alternative perspective on the M&A process and highlighted a number of issues that often don’t receive the attention that they require.

A challenging market

The final conversation of the webinar was led by Wealth Holdings CEO, Keith Brown – who is a regular commentator in IFA Magazine.

Keith is an experienced financial services professional, having worked in the sector for almost 30 ears as a Planner, Business Owner and Managing Director. This wealth of experience was evident in his discussion surrounding the challenges of the M&A market and the benefit of using the services of a broker such as those offered by Wealth Holdings.

He said: “The Wealth Holdings team have a huge amount of experience in the financial services sector and particularly in the M&A space so we were excited to talk to IFAs who may be considering the next step in their career during the webinar.

“It was fantastic to talk to all those looking to sell, to retire, looking to share the burden of running a practice or looking for a partner to take their business to the next level. We hope everyone found our thoughts on how to find the ideal partner, working together to ensure a good outcome for everyone and ensuring a smooth transition to the next step in your career, to be useful.

“To have the opportunity to have everyone in the same space and discuss the ongoings of the M&A market was fantastic and we would be delighted to hear from anyone that has any further questions?”

Conclusion

Overall, IFA Magazine’s M&A-focused webinar provided a fantastic opportunity for advisers to gain insight into the merger & acquisitions market from interaction with our expert panel.

Being so interactive, it allowed our audience to ask questions related to their personal circumstance on what the best course of action for selling, retiring from or purchasing a business might be.

The opportunity to have four experts from different sectors of the M&A market together in one space was both unique and highly engaging. The presentations themselves were well-researched and insightful and credit must be given to all four guests. However, as mentioned, the most intriguing and gripping part of the whole conversation came from the insightful audience questions.

The webinar was a pleasure for us to host at IFA Magazine and we hope our audience enjoyed it as much as we did.

If you missed the opportunity to watch it live, the full recording of IFA Magazine’s webinar is still available on our website, and we’d urge you to check it out by clicking here

About Paul Morrish

Paul is founder of Succession Wealth. He developed his M&A experience leading on two major acquisitions as part of his Director role at Barclays, and subsequently as a consultant leading on business merger, demerger, acquisition, and growth activity, including work for Tesco/RBS, and also several regional in-market transactions. Paul is highly relational, and oversees the end to end activity of every acquisition and subsequent integration for Succession – from due diligence to the commercial discussions, to the successful achievement of an acquired firm’s earn out post acquisition.

About Daniel Bisby

Daniel acts for businesses and individuals, offering expertise and advice on a range of corporate transactions.

His specialisms include acquisitions and disposals (shares and assets), management buyouts and buy-ins, joint ventures, shareholders, refinancing (including banking work) and reorganisations.

He has experience of dealing with acquisitions and disposals within the financial services sector, as well as transactions in the field of sport, media and entertainment.

About Keith Brown

Keith is CEO at Wealth Holdings. He is a performance-driven individual who likes to drive change, working collaboratively as part of a team.

He is an experienced financial services professional, having worked in the sector for almost 30 years as a Planner, Business Owner and Managing Director. Keith has held senior management and board positions including Group Training Director, National Operations Director and Head of Business Development for one of the fastest growing independent wealth management companies in the UK.

He has worked as part of a team to complete over 50 acquisition and integration projects and has had strategic responsibility for planning and implementation of integration activity and processes.

Keith has displayed a track record of building and leading teams to achieve agreed targets and budgets.

He works with internal and external partners to achieve agreed success through a collaborative approach and pragmatic problem solving, building strong, professional relationships to deliver change management programs and manage complex relationships.

About Julian Brincat

Julian Brincat is a specialist IFA PII broker and director at Protean Risk Ltd. Protean is a Lloyds of London Insurance Broker specialising in insurance for financially regulated firms including IFAs, Financial Institutions and Financial Technology and is part of the Howden Group of companies.

Julian has over 15 years of specialist IFA PII knowledge, focusing on firms of all sizes including larger national firms and networks and is experienced in advising firms on both sides of mergers and acquisitions. He has structured programs for some of the UK’s leading consolidators as well as managing run off policies for firms currently going through acquisitions. Protean has access to a wide panel of A rated insurers, including exclusive panels as well as having first-hand experience of the acquisition process due to our own acquisition in 2019.

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