Deal: 7IM was Co-founded by investment guru Justin Urquhart-Stewart (pictured)
One of the world’s biggest pension funds has snapped up a British wealth manager in a much-needed vote of confidence in the City.
The Ontario Teachers’ Pension Plan, which looks after £150billion for more than 300,000 savers, has bought a majority stake in Seven Investment Management (7IM) for £255million.
Co-founded by investment guru Justin Urquhart-Stewart in 2002, 7IM provides wealth and asset management and platform services to 2,300 advisory firms and 7,000 private clients across the UK. Based in London and Edinburgh, it has £21billion of assets and more than 500 staff.
Current owner Caledonia Investments bought the company in 2015 from insurers Zurich Insurance and Aegon. Accounts in March suggested Caledonia’s shareholding in 7IM was valued at £187million – meaning it made a gain of £68million in the sell-off. The sale comes amid a string of deals in the industry.
Earlier this year, Rathbones agreed to buy Investec Wealth & Investment UK in a £839million deal – creating a wealth management powerhouse in a bid to cut costs in the face of rising inflation.
Soaring interest rates have also been a headache for wealth management firms. Rising rates can encourage consumers to push investments towards paying off mortgages or moving funds into savings accounts rather than the stock market.
Tom Leader, Caledonia’s head of private capital, said: ‘In the eight years since our acquisition of 7IM in September 2015, the business has more than doubled assets under management, nearly trebled headcount, and significantly enhanced its revenue and profitability.
‘Caledonia’s investment philosophy is to focus on growth over the long term, ensuring that our portfolio companies are well placed for exit when the right time comes for all stakeholders.’
Dean Proctor, chief executive at 7IM, said: ‘We are well positioned for our next phase of growth and introducing a new investor in Ontario Teachers’ is a natural and planned next step in the development of 7IM.’
