Fairstone partner with MT Financial Management under its DBO programme

July 1, 2020 @ 11:41 by Chloe Holmes

Fairstone, a Chartered financial planning firm, announce that it has signed up new firm MT Financial Management to its unique Downstream Buy Out (DBO) programme.

The deal brings more than 560 clients, five advisers and 11 support staff to the wider business as well as gross fee income of £1.2 million and Funds Under Management of £180m.

This latest DBO deal is the sixth announced so far this year and marks another significant step forward in Fairstone’s growth plan for 2020.

Fairstone’s unique DBO acquisition model operates by integrating an IFA firm, typically over a two-year period, before finally acquiring the business.

This latest deal with MT Financial Management marks the start of this phased pre-acquisition process, enabling both firms to fully align in terms of culture and systems as well as empowering the business owners to optimise their capital realisation and control their sale valuation. MT Financial will also be able to take advantage of the regulatory, technical and operational support that Fairstone provides.

Based in Spalding, Lincolnshire, MT Financial Management specialise in pension planning and investment management.

Fairstone CEO Lee Hartley said: “We are pleased to welcome MT Financial Management into our Downstream Buy Out programme. Mark and his team bring a clear and efficient approach to their work, focussing on regular contact to build long-term client relationships.

“It is vital to have both a business and cultural fit with the companies who decide to join us and we are very pleased to have another company of this quality join Fairstone. MT Financial Management’s team of advisers and support staff will now be able to leverage the strength of Fairstone’s system efficiencies, which will benefit both the front and back office, saving valuable time for the advisers and ensuring clients continue to receive the very best financial advice.”

Fairstone is a full-service wealth management house delivering integration-led growth and its unique DBO approach ensures that companies are fully-integrated with Fairstone prior to final acquisition, ensuring a seamless transition for clients and staff.

Significantly, many companies which have successfully reached full acquisition have enjoyed increased organic growth and a higher valuation than expected on purchase. Figures released at Fairstone’s Annual Conference in Newcastle earlier this year showed 15% outperformance across its entire portfolio of acquired businesses, with these firms delivering more revenue, profits and growth than either their own forecasts, or those upon which the buy-out agreements are based.

MT Financial Management principal Mark Hildred said: “Fairstone has a similar ethos to MT Financial Management, with a determination to service its clients to the highest possible standards. This ensures a seamless transition for our clients whilst offering an enhanced network of expertise.

“We are delighted to have partnered with Fairstone which will ensure the continuity of excellent service we have given our clients for many years and it enables us to retain all our existing advisers and staff.”

Fairstone’s DBO programme continues to be a core driver of growth for the business, reversing the traditional buy and build approach, with integration playing the leading role in a firm joining the programme.

Fairstone CEO Lee Hartley added: ““We are always looking for strong, high quality businesses with ambitious growth plans to join Fairstone and whilst we recognise that we are all moving into a different climate with challenges ahead, we are in a strong position and we will continue to onboard new DBO firms at our forecasted volume.”

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