Investment manager and adviser support services provider Tatton Asset Management is to acquire 50% of DFM 8AM Global for £7m.

The investment manager will also have the option to acquire the remaining half of the DFM.

The deal is subject to regulatory approval.

8AM is an investment manager primarily focussed on delivering risk-profiled model portfolios  and a small range of multi-manager funds.

Tatton said 8AM’s model portfolios and funds will complement the investment manager’s existing proposition, “further demonstrating our commitment to supporting financial advisers in delivering low-cost investment management and enhancing IFA client outcomes.”

The proposed acquisition will provide Tatton’s Financial Planning clients access to an extended range of risk profiled investments utilising 8AM's products.

Tatton said the deal would also give the firm access to a “broader distribution base of UK financial advisers”.

On completion Tatton anticipates 8AM's AUM to be in the region of £0.8bn.

The investment manager added that it expects the 50% share in 8AM to be earnings enhancing, generating adjusted operating profit of £0.7m in its first full year.

Tatton will pay a £3.5m initial consideration, payable through the issue of new shares, and £3.5m deferred consideration payable in equal cash instalments against financial performance targets at the end of the first year and second year post completion.

Paul Hogarth, CEO of Tatton, said: “The business complements our existing offering and brings with it an experienced and motivated management team who are well known to us and culturally aligned to the values of the group. We are very much looking forward to working with them.”

Tatton announced the deal as part of a trading update with financial results for the year ending 31 March.

Assets under management for the investment manager increased 26% over the year to £11.34bn.

Total inflows for the year rose 14.2% to £1.277bn.

Tatton’s acquisition of the Verbatim funds during the year added £0.65bn.