Canaccord Genuity buys Adam & Co for £54m

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Canaccord Genuity Group is to acquire the investment arm of leading Scottish private bank Adam & Co in a £54m deal.

The Canadian group said it had reached an agreement with parent NatWest to acquire the £1.7bn investment management division via its UK wealth management arm (CGWM UK). 

The bank put Adam & Co up for sale earlier this year, and was rumoured to be closing in on a deal in February, almost three decades after rescuing it from insolvency.

Canaccord will pay £54m in cash up-front in a deal expected to complete by the end of September, subject to regulatory approval.

CGWM UK chief executive David Esfandi said the move was a ‘very important milestone’ in the firm’s long-term growth strategy.

Canaccord said it will keep the Adam & Co name and plans to open a new office for the private bank in central Edinburgh.

All staff working for the Scottish firm will move to CGWM UK with investment team will become part of Canaccord’s existing investment committees.

The Canadian group is not acquiring the private bank part of Adam & Co, which Wealth Manager understands will in time be absorbed into Coutts Scotland.

‘The business’s core client proposition will remain largely unchanged, and the existing direct relationships between clients and portfolio managers will not be affected,’ it added.

Launched in 1983, the Royal Bank of Scotland acquired Adam & Co in 1993, following substantial foreign exchange related losses, and was able to provide the capital needed to rebuild the bank’s balance sheet.

The marriage has not always been smooth however, with the beginning of the last decade marked by a succession of significant exits as it used the unit as a test bed for a switch to the Avaloq system.

Around 80% of staff walked out in 2010 to join IM Wealth, following its launch by former Adam & Co head of private client investment administration William Kirkwood and head of investment operation Ross McDonald.

CGWM UK, which manages assets of £29.7bn, also uses the Avaloq platform and said the parties have agreed a detailed migration plan which will be implemented after signing.