The total consideration for the Acquisition is up to £3.75 million, comprising of up to £2.25 million upon completion and contingent consideration of up to £1.5 million. The Acquisition is being funded from cash resources held by the Group.
The transaction is expected to complete in February 2022. Prior to completion, MJFCA will complete the transfer of key supplier contracts, conclude on employee consultations, and notify the Financial Conduct Authority (“FCA”) in connection with the transaction.
The Acquisition constitutes a Class 2 transaction for the purposes of the FCA's Listing Rules.
Details of the Acquisition
MJFCA is a long-established and highly regarded SIPP and SSAS provider based in Manchester. Their specialist level of expertise complements XPS’s existing capabilities and will enable XPS to expand the reach of its offering of high-quality, tailored, great value SIPPs and SSASs to a wider base of clients and financial advisers.
The business being acquired includes all staff and contracts.
XPS is acquiring the business and certain assets of MJFCA and as such there are no audited accounts available for the business being acquired. Based on the financial information ascertained during the due diligence process, the gross assets attributable to the Acquisition were £0.1 million, revenue in the 12 months to 31 March 2021 was £1.9 million and associated EBITDA was £0.4 million.
Rationale for the Acquisition
MJFCA operates at the same, high-services, end of the SSAS / SIPP market as XPS Pensions Group. It is geographically strong in the north of England (in particular Manchester). The profile of its clients is very similar to XPS Pensions Group’s existing Self Invested Pensions business, with a strong focus on commercial property and true self investment. Its staff are experienced and technically knowledgeable, and this presents a two-way opportunity for support and synergy with the existing business. It is a valuable acquisition of a profitable and cash generative business, building our Self Invested Pensions business to deliver further scale economies and benefits for clients. The Acquisition is expected to contribute approximately £1.9 million of revenues per annum to the Group.
Paul Cuff, XPS Pensions Group Co-CEO, said: “We’re hugely excited to welcome the fantastic team from Michael J Field to join our growing business. Their expertise complements our strong and growing Self Invested Pensions business and will enable us to bring our offering of high-quality, tailored, great value SSASs and SIPPs to even more clients and financial advisers.”
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