Solomon Capital Holdings has completed its acquisition of a minority stake in Beaufort Financial Westerham, a Kent-based advice firm, as part of its ‘hub and build’ growth strategy.
The deal brings over £400m in assets under advice to Solomon, along with seven advisers.
Solomon’s acquisition strategy is designed to move away from the common move of buying the advice firm of a retiring principal to “command-and-control”. Instead, Solomon aims to get “ambitious management” on board to collaborate: “It’s a rarity to find firms where they’ve got management that are ambitious and want to continue to grow”, said Simon Goldthorpe, Solomon Capital Holdings’ chairman.
“You often talked about people looking to simply retire and get out. This particular one we think is a good model for the other ones we would like to do as well which is we want the management to stay. We want to work with them rather than just buy them out and build a business together.
“Taking a minority stake has facilitated the buy-out of some existing partners whilst giving the remaining management the ability to focus on the future structure, direction and success of the business”, Mr Goldthorpe continued.
“It is a structure we know there is demand for among certain parts of the adviser community and one we will be looking to roll out in 2023.”
Brian Davies, Beaufort Financial Westerham managing partner, commented: “We have ambitious plans to grow our business and Solomon has proved to be the perfect partner to help us achieve our goals.”
Solomon has had a strong external growth strategy since its founding by former Quilter bosses Andy Thompson and Darren Sharkey and its subsequent backing by PE-firm JC Flowers. The ‘hub and build’ strategy involves Solomon identifying key regions that it wants to expand into and acquiring stakes in established, ambitious businesses in those areas.
“We want to work with the management rather than just buy them out and build a business together. We want to piggyback on the back of good management.
“We are not a command-and-control type of business – we know that kind of management is in short supply – our view is why not try and keep them involved in the business for as long as possible and share in the spoils,” Mr Goldthorpe added.
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