Member Article

Welsh wealth management firm joins up with fast growing Fairstone Group

South Tyneside-headquartered financial management firm Fairstone Group has partnered with Wales-based DHD Wealth Management in a downstream buyout deal.

One of the UK’s fastest growing financial organisations and one of the largest CII Chartered Financial Planning organisations, Fairstone’s revenues are approaching £40m.

Also boasting offices in London and Bristol, the company is made up of financial management, private wealth, corporate solutions, mortgage solutions and estate planning channels.

The deal will boost Fairstone’s total revenue by almost £1.5m, with funds under management rising by approximately £207m. In addition, 4 advisers and 5 support staff will join the broader group, adding to its rapidly growing adviser base of over 265.

Fairstone Group’s downstream buyout model sees the company take an initial minority stake in an IFA business and over a number of years will integrate the firm into its systems and structure.

This helps to minimise Fairstone’s exposure to integration risk and allows the acquired company to profit from their own success upon final acquisition.

Advisers joining Fairstone are able to leverage its core technology platform and added value services. This creates greater efficiencies in the back office as well as supporting the acquisition of new clients through SEO and also reactivating dormant clients.

Collectively, this allows advisers to spend more time on client related activities. These improvements to the operating models of the IFA businesses which have joined the Group have led to growth of around 17 per cent year-on-year in those companies.

Its latest downstream buyout deal to be announced since receiving £25m of private equity backing from Synova Capital earlier this year, CEO Lee Hartley says the deal represents an ‘excellent fit’ for Fairstone

Lee said: “We look forward to working with the well-established team there to support their marketing, front and back office and client acquisition strategies in order to help them grow the business further. We are always looking for strong, high quality businesses with ambitious growth plans to join the Fairstone Group.”

Led by Aled Davies, Clive Davies and Denise Jacob, DHD Wealth Management specialises in investment planning, pensions and IHT planning, representing 1450 clients.

Aled Davies, principal at DHD Wealth Management added: “We joined Fairstone because they are an IFA which has a DFM arm, but does not expect firms such as ourselves to ‘shoe horn’ clients into their proposition.

“Having looked at many proposals, the Fairstone package appealed because we can ultimately complete this transaction yet continue to service our valued clients with whom we have a long term relationship. The fact that Fairstone will also help us recruit new entrants into the business to expand also appealed.”

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