The deal will result in the Liberty SIPP business being wound up.
Liberty’s assets will be merged with Embark Group’s EBS Pensions, a SIPP and SSAS provider with 15,000 clients and £2.8bn in assets under administration.
The merger will create a business with £6.8bn in assets under administration and a combined book of 32,000 SIPP clients.
It’s been confirmed that fast-growing Liberty SIPP is facing litigation over past SIPPs business but a spokesman for Liberty denied the merger was a ‘fire sale’ and said that Liberty was “solvent, trading profitably and growing.”
He added that the owners and executives of Liberty SIPP felt that having grown the business rapidly they were best able to achieve continued growth by being part of a group which could supply “technology, technical depth and capital.” They identified Embark because it has a “strategic plan for growth in the SIPP market and the cultural fit was excellent.”
Liberty and EBS employ 73 in total and there will be no job losses. EBS is expected to be begin recruiting to support its expansion immediately.
It’s been made clear that EBS is acquiring the assets of Liberty “not the business” so the liability for any court cases will remain with Liberty.
Liberty will continue to be “operationally led” by Liberty directors John Fox and Julie Dean.
The cost of the deal is undisclosed but Embark says it will inject £2m of “additional regulatory capital” into EBS to support growth.
The merged business will be headquartered within the Embark Group in Manchester, with a satellite operation in London.
Embark will also provide financial and operational support to the shareholders of Liberty to facilitate the “orderly wind-up of its business.”
Embark Group owns a number of financial brands including Vested, a workplace benefits and advice joint venture run with Mazars, Rowanmoor, Hornbuckle and others. It also runs the Embark Platform.
Liberty SIPP products will be re-branded although clients will be maintained on current terms and conditions.
Phil Smith, chief executive of the Embark Group, said: “This transaction, at this time, provides protection for the consumer clients of Liberty. It is also highly positive for the employees of both businesses and will further improve the growth trajectory for wider stakeholders of the Embark Group.
“Fundamentally, the ex-Liberty team, their clients and distribution partners will thrive with the supportive financial strength, scale, and technology resources of the Embark Group.
John Fox, managing director of Liberty SIPP, said: “The timing and cultural fit of this transaction is excellent for all of us at Liberty. We are moving from being one of the fastest growing small players in the SIPP market, to driving the continued growth of one of the largest sector players.”
• Editor’s Note: Story updated at 11.30 am to include additional comments from Liberty SIPP. Also references to Chartered Financial Planning firm removed as Embark has sold these interests.