Last checked at 
LONDON (Alliance News) - Manx Financial Group PLC on Friday said it has entered into a deal to buy Knox Financial Services Ltd's independent financial advisor business in two deals for around GBP1.7 million.
Knox Financial Services Ltd is part of the Knox Group PLC, which provides financial, investment and property management services.
The financial services group said, under the deal, its subsidiary Edgewater Associated Ltd has agreed to acquire the majority of Knox's Isle of Man independent financial advice business. The initial acquisition is for around 4,000 clients together with 6 members of staff, which generated an anticipated annual renewal income of up to GBP300,000.
Alongside this, both parties have entered into an option agreement, exercisable within three months from the transaction date, for Edgewater to buy the remainder of Knox's independent financial advisor business. This second tranche includes 150 clients generating an anticipated additional renewal income of up to GBP100,000.
Both acquisitions have received regulatory approval, Manx Financial said.
The payments for both transactions, totalling GBP1.7 million in cash, will be done in stages, the first of which is GBP900,000 on completion. A total of GBP200,000 will then be paid at the nine-month milestone and a final reconciling payment will be done on the first anniversary of each acquisition.
The anticipated operating profit of the enlarged Edgewater business is expected to increase by more than GBP400,000 in a normalised year. Combined assets under management of Edgewater will increase by around GBP90.0 million to GBP300.0 million, and the total number of clients will be in excess of 11,000. This, incidentally, is 13% of the Isle of Man's population, Manx Financial said.
"These acquisitions are a very positive development for both Edgewater Associates and Manx Financial Group," said Chief Executive Denham Eke.
"We look forward to welcoming our new clients and providing financial advice with a more active and responsive service in wealth management, retirement planning, protection, loan broking and general insurance. Our investment in systems means that we will be able to operate the businesses at a reduced cost, both to the benefit of clients and our profitability alike," Eke added.
Shares in Manx Financial were up 1.8% at 7.25 pence on Friday.
By Hannah Boland; hannahboland@alliancenews.com; @Hannaheboland
Copyright 2016 Alliance News Limited. All Rights Reserved.
