Schroders has revealed that it paid £72 million to acquire the discretionary wealth management business of C Hoare & Co.
The acquisition, which was announced in October 2016, contributed £2.5 billion in assets under management to Cazenove Capital, the wealth management arm of the business. The deal completed in February 2017.
In its full year results to 31 December 2017, Schroders said that since the acquisition, C Hoare’s business contributed £18.3 million to the group’s pre-exceptional net income. It also added £13.3 million to profit before tax and exceptional items.
In the results, the company also revealed that it acquired Winchester-based wealth management boutique Chilcomb Wealth for a consideration of £1.7 million, on 1 November 2017.
Overall, profit before tax was up 23% to £760.2 million. The business saw net inflows of £9.6 billion, taking assets under management and administration to £447 billion up 13% year on year.
Of the inflows, £7.6 billion was into the asset management arm, which also recorded a 17% increase in operating revenue to £1.7 billion. The division saw £77.5 million come in through performance fees.
Cazenove Capital attracted £2 billion in net new money over the year, turning around following net outflows of £300 million in the previous year. AUM was £45.9 billion at the end of December, while AUA was up by 22% to £11.3 billion.
The board is recommending a final dividend of 79p bringing the full year dividend to 113p per share, up 22% from 2016.
Peter Harrison (pictured), group chief executive, commented: ‘Schroders has again delivered strong results in 2017, with our diversified business model and client-centric approach generating growth across the group. Underlying organic growth and selective acquisitions combined with rigorous cost discipline led to a 24% increase in pre-exceptional profit.
‘Focusing on the longer term, we have continued to see good progress in a number of key strategic areas, with the expansion of our investment capabilities in private assets, an improvement in wealth management and strong underlying momentum in North America.
‘There are headwinds facing the industry but we continue to believe that there remain opportunities for growth. Our diversified business model, ongoing focus on costs, strong financial position and willingness to invest mean that we continue to be well placed.’
Lord Howard of Penrith will be stepping down from the company’s board on 26 April. He had been on the board for over nine years, and will be succeeded by Ian King as senior independent director. King had been a non-executive director since January 2017.
In addition, Nichola Pease will replace Howard as chairman of the remuneration committee. She has been a member of the committee since 2014 and was appointed as a non-executive director in September 2012.
Chairman Michael Dobson said: 'I would like to thank him for his very significant contribution. Ian King's prior experience makes him ideally qualified to assume the position of senior independent director. Nichola Pease's long experience in the asset management industry, and her membership of the Remuneration Committee since 2014, means she is well placed to take over the important role of Remuneration Committee chairman.'