Grosvenor management buy out founding financial planners
The group of Rutherford Rede financial planners which set up Grosvenor Financial Services are about to sell their holdings in the firm to management.
Monday, November 16th 2015, 6:33AM
Grosvenor was set up by a group of Rutherford Rede financial planners 18 years ago to provide funds management and back off services to financial planners. Now it has more than $1.4 billion in funds under management and has 450 advisers distributing its KiwiSaver business.
The firm was established as a joint venture between the financial planners and Oxford Capital, a business associated with current Grosvenor chief executive Allan Yeo.
One of the founding financial advisers, Peter Christensen, says Grosvenor was esablished as they got sick of doing all the work getting business and giving it to fund managers, when that "put all the value on their balance sheet."
Under the management buyout a group of six Grosvenor executives, including Yeo and chief investment officer David Beattie will acquire the 41% of the business owned by interests associated with Rutherford Rede advisers. Their total holding will total around 65% of the business.
Fidelity Life will continue to have a stake in the business of around 16%. Its stake came about as part of the deal to sell its KiwiSaver business to Grosvenor a number of years ago.
Yeo says the deal enables some of the founding advisers to retire.
He says management "are not interested in selling the business," although at one stage there was talk of doing an initial public offering.
Grosvenor's goal is to be the "most trusted financial partner of Kiwis", and for that to happen it works with financial advisers to offer "unbiased, quality advice."
"It's not about selling products. If it was about selling products the internet would take over."
He says a key point of difference is that people get "personalised service and advice."
While the management buyout is going on Grosvenor is also expecting to finalise a new acquisition before the end of this month, Yeo says.
The deal will add around $250 million in funds under management to the business.
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