Ireland and UK wealth manager Davy has agreed to sell its wealth management and capital markets businesses to Bank of Ireland in a 440m Euro (£382m) deal.
The firm has separately agreed to sell its funds business, Davy Global Fund Management (DGFM), to IQ EQ.
Both IQ-EQ and Bank of Ireland were long-term strategic owners of Davy.
Both deals are subject to regulatory approval.
Founded in 1926, Davy manages in excess of 16bn Euros of client assets and employs over 800 people, including 83 employed by DGFM.
The firm has offices in Dublin, Cork, Galway, Belfast, and London, providing wealth management, capital markets advisory services, and DGFM services to its clients.
For the year ended 31 December 2020, Davy had adjusted profit before tax of 32.8m Euros (£28.5m) and adjusted gross assets of 756.3m Euros (£658m).
Bank of Ireland said acquiring Davy will materially increase the group’s wealth and fee income and the acquisition is expected to be accretive to earnings in the first full year of ownership, excluding transaction related payments.
Growing the wealth and insurance business is a key priority for Bank of Ireland, it says. Its wealth and insurance business currently has over 600,000 customers, including more than 250,000 wealth customers.
The bank said its acquisition of Davy would significantly strengthen the range of services available to group customers including in the high net worth and mass affluent categories.
Francesca McDonagh, group chief executive of Bank of Ireland, said: “When we look at any acquisition, we consider two key things – if it offers value to our shareholders, and if it is a good fit for our business. Davy scores very highly on both.
“Wealth management and capital markets are important parts of our business. Bringing Davy into the group represents a significant milestone which will considerably enhance our customer offerings and growth outlook for the group. It is our ambition to build on Davy’s unrivalled leadership position in these businesses, while also enabling it to benefit from a range of comprehensive culture, risk and governance programmes that we have successfully introduced in recent years. Accordingly, we see a continuation of the Davy brand and structure, under the Bank of Ireland umbrella.”
Davy’s 63% shareholding in Rize ETF is also to be sold to AssetCo, chaired by former Standard Life Aberdeen joint chief executive Martin Gilbert, for £16.5m. The acquisition is expected to close next week and is not condition on regulatory approvals.
Rize ETF, launched in February 2020, claims to be Europe’s first thematic issuer of ETFs. The firm currently has £327.4m in assets under management.
The acquisition is the latest in a string of deals for AssetCo, which appointed Mr Gilbert as chairman in March to spearhead its acquisition strategy. Earlier this month the firm acquired a 30% stake in adviser platform Parmenion Capital Partners.