a practical example

Many of our clients are flexible in their approach, but their preferred option is to purchase your business and assets and not the shares of your company. Our client firms are keen to expand with like minded IFA businesses, provided that quality, reputation and underlying business values are enhanced for both parties

The following example highlights how such an arrangement could work for you:

  • You agree to sell your client bank and the associated goodwill to the purchasing IFA business in return for a multiple of between 2.5 to 3 times your existing renewal income (Guideline figures based on recent experience);
  • The earn out is paid over the course of the next 2 to 3 years, on a regular basis, in order to provide a suitable transitional period for your existing clients to build a solid working relationship with the purchasing IFA business( Actual terms may vary);
  • The continuing employment of your existing administration and advisory staff would be considered on its own merits;
  • You and/or fellow Principal’s role could continue to involve the advice process, or if preferred this could purely involve passing on introductions. Either option would be subject to an agreed income split to provide an incentive to you;
  • Your existing business could then apply to be de-authorised by FSA, thus removing the ongoing fixed costs associated with FSA fees and PI cover; and 
  • Depending on your existing business structure, you would then have no further responsibility for day to day compliance issues.

For ease, indicative Sale Agreements and outline Head of Terms can be provided by threesixty which are then subject to your own legal advisors scrutiny.

 

DOWNLOAD Download our 'Sellers Guide to Business Consolidation'
REGISTER Register for the service by Completing the Confidential Sellers Questionnaire. The complete the form on paper click here.