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Wealth consolidator's AUM jumps to £4.5bn on buy spree

Wealth consolidator's AUM jumps to £4.5bn on buy spree

AFH Financial's acquisition spree has borne fruit over the last 12 months. 

In a trading update covering the 12 months to 31 October, the wealth consolidator said assets under management (AUM) rose from £2.8 billion to £4.5 billion. 

The firm expects revenues for the year to exceed £50 million, a near 50% increase on the £33.6 million achieved in 2017. 

Performance was fuelled by the 16 acquisitions AFH made over the course of the year, which cost the firm £34 million. 

The organic side of the business also played its part, accounting for £20 million of the revenue growth. Meanwhile existing and new clients were responsible for £450 million of the gross AUM growth. 

The firm said integrations of the acquisitions are in line with expectations, with 90% of deferred earn outs paid at over 90% of target. 

Earlier this month AFH acquired York-based Premier Wealth Management Harrogate, which had been struggling to cope with growing regulatory costs. 

AFH said it was well positioned to continue to take advantage on ongoing consolidation in the advice market and that it has a 'strong pipeline of potential acquisitions currently under negotiation'. 

Following successful placings at the end of 2017 and in October, the firm has £22 million sitting in the bank to fund more buys. 

AFH chief Alan Hudson (pictured) said he was encouraged by his firm's 'exceptional' progress over the last 12 months. 

'The success and robustness of our acquisition model is reflected in the continued high level of acquisitions meeting earn out targets and the strong cash flow generated by the business to finance these earn out payments,' Hudson said. 

'The support of new and existing institutional shareholders throughout the year has provided the company with the funds to continue to acquire a number of earnings accretive IFA businesses, whilst expanding our national footprint at a time when the requirement for financial planning and personal asset management continues to grow.'

 

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