Acquisitions and share placing to finance future growth


Acquisitions of Jupiter Asset Management Limited’s private client and charity investment management business and part of the London private client wealth management business of Tilney Investment Management Limited and share placing


  • Acquisition of Jupiter Asset Management Limited’s private client and charity investment management business for £43.1 million (assuming full value of funds under management transferred)
  • Acquisition of part of the London private client wealth management business of Tilney Investment Management Limited for £14.3 million (assuming full value of funds under management transferred)
  • Placing with existing institutional investors of 1,343,000 Placing Shares at 1,814p (being the closing share price on 31 March 2014) to raise £24.4 million 
  • The combined effect of the acquisitions (taking into account the share placing) is expected to be earnings neutral in 2014 and earnings-enhancing in 2015
  • On a pro-forma basis, Rathbones' funds under management increase by approximately 12.7% to £24.8 billion

Acquisition of Jupiter Asset Management Limited’s private client and charity investment management business

Rathbone Brothers Plc ("Rathbones" or the "Company") announces that its wholly-owned principal subsidiary, Rathbone Investment Management Limited ("RIM"), has agreed to purchase Jupiter Asset Management Limited’s private client and charity investment management business ("Jupiter Private Clients"). As a result it expects to welcome a team of 28 professionals to Rathbones. The team is led by Andrew Clark, Head of Jupiter Private Clients, and includes 12 experienced investment managers. 

Jupiter Private Clients’ funds under management subject to the transaction were £2.1 billion at 14 March 2014. The level of consideration payable by RIM to Jupiter Asset Management Limited will be calculated based on the quantum and mix of funds under management transferred at completion, with reference to their value as at 14 March 2014, and taking into account any additions or withdrawals (but not market movements) over the period between this date and completion. 

Should the full value of Jupiter Private Clients’ funds under management subject to the transaction transfer to RIM at completion, based on their value at 14 March 2014, the consideration would be £43.1 million in cash. The consideration is subject to a minimum level of £32.0 million and a maximum level of £53.9 million (should additional funds under management from new or existing clients of Jupiter Private Clients transfer to RIM). The consideration will be paid on completion, which is expected to occur towards the end of the third quarter of 2014, and will be financed from internal resources. No other assets will transfer to Rathbones as a result of the transaction.  
Rathbones' funds under management were £22.0 billion at 31 December 2013. If all Jupiter Private Clients' funds under management, as at 14 March 2014, transfer to Rathbones, this will increase Rathbones' funds under management on a pro-forma basis by 9.5% to £24.1 billion. 

In the year ended 31 December 2013, the funds attributable to Jupiter Private Clients generated pro-forma revenues of £12.1 million. Related pro-forma costs of £5.6 million were associated with the 28 professionals being taken on by Rathbones for the equivalent period. The pro-forma profit contribution in 2013 of the acquired business, assuming 100% transfer of funds under management to Rathbones at completion, would therefore have been £6.5m before overheads, administrative expenses and central costs. Rathbones' project and transaction costs in 2014 are expected to be approximately £1.8 million. The transaction is expected to be earnings-enhancing in 2015.

Rathbones was advised by Canaccord Genuity and Addleshaw Goddard LLP in relation to the acquisition.

Acquisition of part of the London private client wealth management business of Tilney Investment Management Limited

Rathbones also announces that RIM has agreed to purchase part of the London private client wealth management business of Tilney Investment Management Limited, which is part of Deutsche Asset & Wealth Management ("Tilney London Private Clients"). As a result, it welcomes a team of five investment professionals, led by Jeremy Newman, who will join Rathbones.

Tilney London Private Clients' funds under management were £0.7 billion at 21 February 2014. The cost to RIM, if 100% of the funds under management were to transfer, would be £14.3 million payable at various times between completion (expected by the end of June 2014) and January 2016.

The transaction is expected to result in a small accretion in earnings in 2014 and to be earnings-enhancing in 2015.

Share placing

Rathbones also announces that it has raised approximately £24.4 million (before expenses) via a non-pre-emptive share placing, with existing institutional investors, of 1,343,000 new ordinary shares of 5 pence each in the capital of the Company ("Placing Shares"). The Placing Shares have been issued at a price of 1,814 pence per Placing Share ("Placing Price"), being the closing share price on 31 March 2014, and represent approximately 2.9 per cent of the Company’s issued share capital ("Placing").

Background to and reasons for the Placing

Assuming that all of the funds under management of Jupiter Private Clients and Tilney London Private Clients transfer to Rathbones, then (based upon values of acquired funds under management at 14 March 2014, for Jupiter Private Clients, and 21 February 2014, for Tilney London Private Clients) the total consideration payable under these transactions is expected to be £57.4 million.

The Jupiter and Tilney London transactions illustrate Rathbones’ ability to capitalise on earnings-enhancing acquisition opportunities to grow its business. As a result of these transactions the amount of surplus capital allocated by the Company for acquisitions is expected to be largely utilised. The Placing provides the Company with the flexibility to continue to respond to similar earnings-enhancing acquisition opportunities. Proceeds of the Placing are expected to be used to replenish capital which has been utilised in recent acquisitions (including those announced today) in order to take advantage of further acquisition opportunities and for general corporate purposes.

Terms of the Placing

Rathbones appointed Canaccord Genuity Limited and Peel Hunt LLP as Joint Bookrunners, joint brokers and agents to the Placing.

The Placing is not underwritten, and was carried out pursuant to the authorities granted by shareholders at the Company's annual general meeting on 14 May 2013, so does not require any further shareholder approval. Application has been made for the Placing Shares to be admitted to the premium segment of the Official List of the Financial Conduct Authority and to trading on the Main Market of the London Stock Exchange ("Admission"). Settlement for the Placing Shares together with Admission is expected to become effective on 4 April 2014.

Following Admission, the Company will have issued 47,657,339 ordinary shares of 5 pence each in the Company, of which 50,000 are held in treasury. On Admission, the Company therefore will have 47,607,339 shares in issue excluding shares held in treasury. This number represents the total voting rights in the Company and may be used by shareholders as the denominator for the calculations by which they can determine if they are required to notify their interest in, or a change to their interest in, the Company under the Financial Conduct Authority's Disclosure and Transparency Rules.

On Admission, the Placing Shares will rank pari passu in all respects with the existing ordinary shares in the capital of the Company.

Philip Howell, Chief Executive of Rathbone Brothers Plc, commented:

“The acquisitions of these businesses from Jupiter Asset Management and Tilney Investment Management are an excellent fit. They demonstrate the merits of Rathbones to both clients and investment management teams, as well as our ability to capitalise on earnings-enhancing acquisition opportunities to grow our business. We welcome the clients and investment teams of Jupiter and Tilney London and are sure that they will benefit from the stability and infrastructure that Rathbones provides.

"We expect to see more acquisition opportunities in the private client industry in the short to medium term. Raising capital now will give us flexibility to continue to take advantage of similar opportunities as they arise."

For further information contact:

Rathbones Brothers Plc
Mark Nicholls, Chairman
Philip Howell, Chief Executive
Paul Stockton, Finance Director 
Tel: 0207 399 0000

Canaccord Genuity Limited
Martin Green / Lucy Tilley (Corporate Broking)
Charles Williams/Rupert Pepper (Advisory)
 Tel: 020 7523 8000
Peel Hunt LLP
Guy Wiehahn / Harry Florry (Corporate)
Andy Crossley / Al Rae (Corporate Sales & Syndications)
 Tel: 020 7418 8900

Quill PR
Hugo Mortimer-Harvey Tel: 020 7466 5054

Rathbone Brothers Plc

Rathbone Brothers Plc is a leading provider of high-quality, personalised investment and wealth management services for private clients, charities and trustees. This includes discretionary investment management, unit trusts, tax planning, trust and company management, pension advice and banking services.

Rathbones has over 870 staff in 13 UK locations and Jersey and has its head office at 1 Curzon Street, London.


This Announcement has been issued by, and is the sole responsibility of, the Company.

Members of the public are not eligible to take part in the Placing.

This Announcement provides information about the Placing, but does not invite participation in the Placing. This Announcement does not constitute, and the Company is not making, an offer to the public of transferable securities within the meaning of sections 85 and 102B of the Financial Services and Markets Act 2000 ("FSMA"). This Announcement is therefore not an approved prospectus for the purposes of section 85 of FSMA, and has not been prepared in accordance with the prospectus rules of the FCA and as such neither its contents nor its issue have been approved by the FCA or by any authority which would be a competent authority for the purposes of any legislation that implements the Prospectus Directive.

This Announcement and the information contained herein is not for release, publication or distribution, in whole or in part, directly or indirectly, in or into the United States (including its territories and possessions, any state of the United States and the District of Columbia), Australia, Canada, Japan or any other state or jurisdiction into which the same would be unlawful.

This Announcement is for information purposes only and does not constitute or form part of any offer to issue or sell, or the solicitation of an offer to acquire, purchase or subscribe for, any securities in the United States, Australia, Canada or Japan or any other jurisdiction in which such offer, solicitation or sale would be unlawful. Any failure to comply with these restrictions may constitute a violation of the securities laws of such jurisdiction. In particular, the Placing Shares have not been and will not be registered under the United States Securities Act of 1933, as amended (the "Securities Act") and may not be offered, sold or transferred, directly or indirectly, within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and the securities laws of any state or other jurisdiction of the United States. No public offering of the Placing Shares is being made in the United States, Australia, Canada or Japan.

Canaccord Genuity Limited ("Canaccord") and Peel Hunt LLP (“Peel Hunt”), who are authorised and regulated in the United Kingdom by the Financial Conduct Authority ("FCA"), are acting exclusively as financial advisers to and joint bookrunners to Rathbone Brothers Plc and for no one else in connection with the Placing and will not be responsible to anyone other than Rathbone Brothers Plc for providing the protections afforded to clients of Canaccord and Peel Hunt respectively or for providing advice in relation to the Placing or any matter referred to in this Announcement.

The price of the ordinary shares of the Company may go down as well as up and investors may not get back the full amount invested on disposal of the ordinary shares of the Company. Past performance is no guide to future performance and persons needing advice should consult an appropriately authorised independent financial adviser.

The Placing Shares to be issued pursuant to the Placing will not be admitted to trading on any stock exchanges other than the London Stock Exchange.

Neither the content of the Company's website nor any website accessible by hyperlinks on the Company's website is incorporated in, or forms part of, this Announcement.

This Announcement contains (or may contain) certain forward-looking statements with respect to certain of the Company's current expectations and projections about future events. These statements, which sometimes use words such as "aim", "anticipate", "believe", "intend", "plan", "estimate", "expect" and words of similar meaning, reflect the directors' beliefs and expectations and involve a number of risks, uncertainties and assumptions that could cause actual results and performance to differ materially from any expected future results or performance expressed or implied by the forward-looking statement. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances. Statements contained in this Announcement regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. The information contained in this Announcement is subject to change without notice and, except as required by applicable law, the Company does not assume any responsibility or obligation to update publicly or review any of the forward-looking statements contained herein. Investors should not place undue reliance on forward-looking statements, which speak only as of the date of this Announcement. No statement in this Announcement is or is intended to be a profit forecast or to imply that the earnings of the Company for the current or future financial years will necessarily match or exceed the historical or published earnings of the Company.