Tenet says IFAs are being cold called with offers for firms

Issued: 22/02/2010 00:00:00

Three out of 10 advisers surveyed by Tenet said they were looking to grow their businesses during both the pre and post-retail distribution review (RDR) environment

A number of firms told Tenet they saw increased business opportunity caused by genuine and growing increase in demand for advice, but in part also contributed to by the belief that up to 20 per cent of IFAs will exit the industry either in the run up to or at the point of RDR implementation.

Keith Richards, group distribution and development director of Tenet, said exit planning has now become a hot topic for discussion among the adviser community and there is a growing practice of cold canvassing letters being sent to IFAs offering to buy their business.

He said: "Firms are now receiving cold calling letters from accountants stating that they are acting on behalf of a prospective client who is particularly interested in acquiring the practice.

"I have no doubt that in some instances these approaches are genuine, but in the majority it is evidently clear, that a scatter gun approach is being adopted.

"However, exit planning considerations have been accelerated as a result of RDR proposals and I expect we will see an increasing number of small practice mergers as part of the solution."

Tenet launched a merger and acquisition facility last year and currently receives on average three requests a week for support.

A mergers and acquisitions directory of interested parties has been built to help match firms interested in either sale, merger or growth.

Source: Emma Ann Hughes, FT Adviser, February 22nd 2010