Close Brothers completes sale of asset management arm to Oaktree

(Alliance News) - Close Brothers Group PLC on Monday said it has completed the sale of its wealth management division, Close Brothers Asset Management, to funds managed by Oaktree Capital Management LP, strengthening its capital position and allowing it to focus on core operations.

The London-based bank, broker and asset manager said the sale, first announced in September, was finalised on February 28 after receiving regulatory approvals. The transaction is expected to increase the group's common equity tier 1 capital ratio by approximately 120 basis points to around 13%.

Close Brothers received an upfront cash consideration of GBP146 million and a further GBP21 million in contingent deferred consideration in the form of preference shares, valuing the total deal at up to GBP167 million. The company anticipates a pretax gain on disposal of approximately GBP59 million, which it expects to recognise in its full-year 2025 financial statements.

Close Brothers Chief Executive Officer Mike Morgan said: "This strategic transaction marks a significant milestone in delivering on our previously outlined management actions to strengthen the group's capital base. The sale is expected to increase the group's common equity tier 1 capital ratio by approximately 120 basis points, allowing us to simplify the group and sharpen our focus on the core business."

Oaktree Managing Director Federico Alvarez-Demalde said: "We are delighted to partner with Close Brothers to execute the full carve-out of the asset management business. As a selected partner for this transaction, we are committed to working diligently to ensure a smooth transition for clients, including a comprehensive rebrand."

Close Brothers said CBAM will be classified as 'discontinued operations' in its half-year 2025 financial statements. The company expects an additional capital benefit of up to 25 basis points over the next three years due to a reduction in operational risk-weighted assets associated with the business.

Shares in Close Brothers were up 2.1% at 337.90 pence in London on Monday afternoon, giving the company a market capitalisation of GBP508.5 million.

By Eva Castanedo, Alliance News reporter

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