Swindon financial management firm Intrinsic has sold its entire network of 3,000 advisers – the UK’s largest – to Old Mutual Wealth in a move that has sent ripples through the insurance industry.
The deal, for an undisclosed sum, comes less than eight years after Intrinsic was launched in Swindon by a group of leading financial services sector figures with their roots in the town, mainly from pioneering insurance group Allied Dunbar.
It is the latest seismic shift in the way the insurance industry operates, with a Swindon firm again at its epicentre.
Under the move Intrinsic, whose chairman and founder is Lord (Sandy) Leitch – one-time Allied Dunbar chief and a financial services industry stalwart – keeps its own brand and management team. Old Mutual’s Skandia platform will be added to Intrinsic’s platform panel.
Old Mutual said it would work with Intrinsic to develop ‘its core investment propositions’, using Old Mutual Global Investors’ capabilities.
Intrinsic chief executive Richard Freeman, who started his career in direct sales at Allied Dunbar, said having a single shareholder would strengthen the Intrinsic business.
Intrinsic’s financial backers include major financial services provider Friends Life, South African financial services firm Sanlam, and Aegon, one of the world’s largest life insurance and pensions companies.
The sale of its network of restricted and independent financial advisers comes less than eight months after it acquired Positive Solutions from Aegon – a move which added 850 advisers to its network, taking its total to around 3,000.
It was Intrinsic’s third acquisition following the takeover of Mint Financial Services in 2008 and Blueprint Financial Services in 2012.
In 2012, the last year for which figures are available, Intrinsic’s network made pre-tax profits of £5.2m – 62% up on 2011 – on turnover of £121m. It also set aside more than £2m for complaint settlements.
The firm was launched in 2005 by Lord Leitch, who had been awarded a Life Peerage the previous year. It began trading in 2006.
Lord Leitch is chairman of Bupa and has been CEO of Zurich UKISA, chairman of Scottish Widows, deputy chairman of Lloyds Banking Group and chairman of Threadneedle Asset Management. He was also chair of the Association of British Insurers.
Intrinsic finance director Simon Brunt was part of the Swindon-based Zurich Financial Services team that evaluated and launched Openwork in the town in 2005. He became Openwork’s finance director until joining Intrinsic in 2011.
Swindon law firm Thrings provided advice on all legal and strategic matters to Intrinsic and its management team in the deal. Tax and accountancy advice was provided by KPMG.
The Thrings team was led by senior corporate partner Jonathan Payne and associate solicitor Elaine Meyrick.
The deal is subject to regulatory approval and is expected to complete within 90 days.
Thrings has been providing legal advice to Swindon-headquartered Intrinsic since 2006, a period in which it has become one of the UK's fastest-growing financial advice services companies.
Jonathan Payne said: “Thrings has worked closely with Intrinsic’s management team for the past eight years, and during this time we have developed a thorough understanding of the business and its ambitions. This has enabled us to provide ongoing legal advice which supports the company’s commercial and strategic objectives.
“Intrinsic is already one of the leading providers of financial advice and wealth management in the UK, and this deal will provide the opportunity and financial platform to strengthen its reputation and meet the long-term needs of its customers. This is a significant development in Intrinsic’s history, and we believe the deal will propel the business on to even greater successes in the future.”
Intrinsic governance and legal director Wallace Dobbin said: “It was imperative we received the very best legal advice during this transaction. Jonathan and his team played a pivotal role throughout, demonstrating great commercial awareness and discretion while acting in the best interests of Intrinsic at all times.
“I would like to thank Jonathan, Elaine and the rest of the Thrings team for their support over the last few months. They were magnificent and we simply could not have done it without them.”