Tavistock has acquired the entire issued and to be issued share capital of Bangor, Northern Ireland-based health and protection adviser firm Precise Protect.
Precise Protect has a network of over 200 advisers working with more than 37,000 UK clients, with an average age of under 40.
Precise offers its clients a range of products – including life and critical illness cover, private medical insurance, personal injury and income protection – several of which were developed in-house and are unique to the firm.
In the year ended 31 October 2022, Precise Protect reported a profit before tax of £1.45m on turnover of £6.5m and net assets of £1.23m.
Following the deal, the Tavistock group will have more than 400 advisers and other business introducers looking after more than 110,000 private clients with estimated assets of over £5bn, as well as 350 corporate and affinity clients with some 16,000 employees.
Precise Protect is regulated by the Financial Conduct Authority and Tavistock has received change in control consent for the transaction from the FCA.
The total consideration for the transaction (assuming the achievement of all performance related earn-outs) will be around £7m.
Tony Close, managing director at Precise Protect, said: “Precise Protect’s revenues and EBITDA have grown rapidly and we remain excited about its prospects.
“However, we are very pleased to be joining the Tavistock group which will enable us to offer a much wider range of services to our clients, as well as deliver a development pathway for advisers and career development opportunities for staff.”
Brian Raven, chief executive at Tavistock, added: “We are delighted to welcome Tony and his team into the group and to add Precise Protect’s products to the wider group’s service proposition.
“We look forward to benefitting from numerous synergies, including operational cost savings, increased profitability and new business leads.”
New shares issued
Tavistock noted that £250,000 of the consideration is to be settled through the issue of 3,571,429 new ordinary shares of one penny each in the capital of Tavistock Investments Plc at an issue price of 7p per share, with the balance being settled in cash from the company’s existing cash resources and the company drawing down from the acquisition debt facility provided by the Bank of Ireland.
£2.75m of the cash consideration is being paid now, together with the issue of the shares, conditional on admission to trading on AIM.
The balance of the cash consideration, totalling up to £4m, is payable in three subsequent annual instalments, the value of each being linked to the future performance of the Precise Protect business.
An application has been submitted to the London Stock Exchange for the Consideration Shares to be admitted to trading on AIM and trading in the Consideration Shares is anticipated to start on 13 April.
Upon admission, the company’s issued share capital will comprise of 560,429,005 ordinary shares of one penny each, with one voting right per share – ordinary shares.
The company does not hold any ordinary shares in treasury and therefore the total number of ordinary shares with voting rights in the company is 560,429,005.
With effect from admission, the above figure of 560,429,005 may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the share capital of the Company under the FCA’s Disclosure Guidance and Transparency Rules.
Precise Protect said the deal marked its first significant acquisition in the next phase of its growth plan, adding it will also provide opportunities for operational cost savings such as software, systems and regulatory oversight, while Tavistock will also benefit from Precise Protect’s experienced and dedicated specialist team.