TIDMTEAM
RNS Number : 2488B
Team PLC
01 June 2023
1 June 2023
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TEAM PLC
("TEAM", the "Company" or the "Group")
Conditional Acquisition of Thornton Associates
Leading Isle of Man Financial Planning Business
TEAM plc (AIM: TEAM), the wealth, asset management and
complementary financial services group, is pleased to announce that
it has conditionally agreed to acquire the entire issued share
capital of Thornton Associates Limited, trading as Thornton
Chartered Financial Planners ("Thornton"), (the "Acquisition") for
a consideration of up to GBP2.5 million. Thornton is an Isle of Man
based financial planning business, the first chartered status firm
on the island, providing holistic financial planning services with
assets under advice ("AUA") of GBP121 million and approximately 180
client groups.
Highlights
-- Conditional acquisition of Thornton for consideration of up to GBP2.5 million
-- Natural fit with TEAM's assets in Jersey and in line with
strategy to expand into other Crown Dependencies
-- Potential for delivery of significant synergies and cross-selling opportunities
-- TEAM is also announcing separately today its unaudited
interim results for the six months ended 31 March 2023 and the
acquisition of Globaleye Wealth Management Group ("Globaleye")
-- Post-completion, these two acquisitions will take TEAM's
assets under management and advice to over GBP850 million
-- Thornton and Globaleye represent TEAM's fifth and sixth acquisitions in the last three years
Consideration
On completion of the Acquisition ("Completion"), an initial
consideration of GBP0.9 million is payable in cash, plus an amount
equal to the net assets of Thornton of GBP250,000 less regulatory
capital of GBP50,000. In addition, a deferred consideration of up
to GBP1.4 million is payable, half in new TEAM shares and half in
cash. The deferred consideration is payable in two instalments of
up to GBP700,000, dependent upon the revenue generated by Thornton
in the 24 months following Completion. The Acquisition is subject
to approval by the Isle of Man Financial Services Commission and is
expected to complete in Autumn 2023. The cash consideration payable
will be funded through existing resources within the Group, and
from the future earnings of TEAM.
Thornton - overview
-- Thornton is a firm of chartered Financial Planners providing
multi-jurisdictional financial planning and regulated investment
advice to private individuals, trustees and business owners on the
Isle of Man
-- Founded in 2000 by its Managing Director, Sharon Sutton, it
now supports some 180 client groups (typically high net worth
couples and families) with unaudited AUA as at 31 March 2023 of
GBP121 million, largely invested by third party discretionary
managers
-- In the year ended 31 March 2023, Thornton generated unaudited
revenues of GBP0.75 million, profit before and after tax of GBP0.22
million and as at 31 March 2023 had unaudited net assets of GBP0.40
million
Acquisition Rationale
-- In a market where competition is limited, Thornton is a
profitable, well-managed and highly regarded financial planning
business. The TEAM Directors expect a smooth integration with the
Group. A key element of TEAM's strategy is to have representation
in all of the Crown Dependencies. Thornton is the first step it has
taken outside Jersey and makes for a compelling strategic and
cultural fit with TEAM, given complementary business models, strong
client relationships and an active flow of new clients coming into
Thornton
-- The Isle of Man represents an exciting opportunity for TEAM. In addition:
o Potential synergies have been identified by TEAM's Directors,
primarily through Thornton joining a larger financial planning
group and being able to access shared support services
o Opportunity to offer Thornton services to current and future
TEAM clients, and vice versa, most significantly the opportunity
for Thornton clients to migrate from third party managers to using
the investment expertise of TEAM Asset Management and its model
portfolio and bespoke services
o TEAM plans to integrate Thornton into its financial planning
activities, sharing best in class practices across the offices and
moving towards one operating model and brand. No one-off costs are
expected from this integration exercise
-- The Acquisition is expected to be earnings enhancing in the first year of ownership
-- The total consideration payable represents an estimated
forward P/E of 7x before revenue and cost synergies are
generated
-- The Acquisition will be the Company's fifth transaction since
its inception in January 2020 and is expected to complete in Autumn
2023
-- On completion of the acquisitions of both Thornton and
Globaleye, TEAM expects to have assets under management and advice
of over GBP850 million
Matthew Moore, CFO of TEAM, commented:
" In the Isle of Man, Thornton has been at the forefront of
financial planning to help its clients manage, protect and maximise
their wealth. In doing so, it has built a strong reputation across
the island. Becoming part of TEAM is a natural fit and will, we
believe, facilitate the next stage of growth for Thornton which
will benefit from being part of a larger group, offering a wider
range of services whilst maintaining the same customer centric
ethos.
We are delighted to welcome Thornton into the Group. The
acquisition is a natural extension into the Isle of Man from our
base in Jersey and matches our strategy to build a new wealth,
asset management and complementary financial services group with a
focus on the UK, Crown Dependencies and International Finance
Centres."
Market Abuse Regulation
For the purposes of MAR and Article 2 of Commission Implementing
Regulation (EU) 2016/1055, this Announcement is being made on
behalf of the Company by Matthew Moore, Chief Financial Officer of
the Company.
Enquiries to
TEAM plc
Mark Clubb, Executive Chair
Matthew Moore, CFO and COO +44 1534 877 210
Hatstone (Legal adviser to TEAM)
Simon Vivian
Shore Capital (Nominated Adviser and Broker
to TEAM)
Tom Griffiths, Iain Sexton, Guy Wiehahn +44 20 7523 8000
Novella Communications (Financial Public
Relations)
Tim Robertson, Claire de Groot, Safia Colebrook +44 20 3151 7008
Hannam & Partners (Financial adviser to
TEAM)
Giles Fitzpatrick, Ernest Bell, Richard Clarke +44 20 7907 8500
www.teamplc.co.uk
Background
TEAM plc is building a new wealth, asset management and
complementary financial services group. With a focus on the UK,
Crown Dependencies and International Finance Centres, the strategy
is to build local businesses of scale around TEAM plc's core skill
of providing investment management services. Growth will be
achieved via targeted and opportunistic acquisitions, through team
and individual hires, through collaboration with suitable partners,
and organic growth and expansion.
Thornton results
Figures in the below table are taken from the unaudited
management accounts for the year ended 31 March 2023.
GBP'000 Year ended 31
March 2023
Gross income 747
---------------
Profit before
tax 218
---------------
Client AuA GBP121 million
---------------
Net assets 400
---------------
Figures in Table below are an illustrative representation of the
Group's expectation for the acquired business in a full financial
year.
GBP'000 Illustrative
full year
Gross income 750
-------------
Profit before
tax 250
-------------
The financial illustrations set out in this announcement are
illustrative only, representing reasonable assumptions, based on
the financial information available at the time of the
announcement. However, all financial information provided is
subject to change and these illustrations may be different from the
actual financial position. No reliance should be placed on the
illustrations set out in this announcement.
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