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Rathbones and Permira set for £200m bid war for Speirs & Jeffrey

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Rathbones and Permira set for £200m bid war for Speirs & Jeffrey

Rathbone Brothers and private equity giant Permira are set to lock horns in a bid war for Speirs and Jeffrey.

According to The Telegraph, the pair are preparing bids in the region of £200 million for the Glasgow-based private client stockbroker. 

In an announcement posted on the stockmarket this morning, Rathbones confirmed the talks. 

'Rathbones regularly assesses various acquisition opportunities in line with its stated strategy and accordingly confirms that discussions between Rathbones and Speirs & Jeffrey in relation to a possible acquisition of Speirs & Jeffrey by Rathbones are taking place,' the statement read. 

'No binding offer has been made and there can be no certainty that any binding offer will be made nor that agreement will be reached with the board and shareholders of Speirs & Jeffrey.'

Speirs and Jeffrey, which was founded in 1906, has codenamed the sale ‘Project Argus’ and is said to have hired boutique M&A specialist Spencer House Partners to help find a buyer.

The Scottish investment manager runs some £5.5 billion in assets and has been headed by chief executive Russell Crichton since 2011. Its most recent set of results posted on Companies House covering the 12 months to 10 May showed revenues of £25.3 million against pre-tax profit of £9 million.

Last year Wealth Manager revealed the firm had withdrawn investment services for clients with portfolios below £70,000 and raised its minimum charge, citing rising regulatory costs.

If Spencer House is able to secure a £200 million sale, Speirs and Jeffrey's 10 partners are in line to net £20 million each. The winning bid is expected to be announced over the next few weeks.

The news comes after Rathbones and Permira-owned Tilney were embroiled in a bid battle for Smith & Williamson last year, with the latter reported to have made an eleventh hour offer to scupper Rathbones' proposed merger with S&W.  The bid eventually collapsed after S&W opted to go for a stock market listing.

In its full-year results posted on 22 February, Rathbones said it was launching a major strategy review as it closed on its long-term assets target of £40 billion earlier than anticipated.

‘In 2014 we set out a five-year strategy which had the ambition to reach £40 billion of funds under management by the end of 2018,’ said Rathbones' chair Mark Nicholls at the time.

Commenting on the speculation, a spokesperson for Speirs and Jeffrey told The Telegraph: ‘Since we were founded, it has been our consistent policy never to comment on the inevitable speculation which arises from time to time.'

Permira did not comment. 

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