Consilium flags more adviser equity deals as alternative exit strategy | Investment News NZ

National financial advisory services and platform business, Consilium, is open to buying stakes in other advice firms after wrapping up its second deal last week.

Consilium took a 35 per cent share in the Christchurch-based Cambridge Partners via a subsidiary trustee vehicle early in July following a similar arrangement in November 2022 where it acquired half of Auckland practice, The Private Office (TPO).

According to a spokesperson for the group, while there are no further equity deals in the pipeline “involvement from Consilium could be an option for other firms when they approach a similar succession plan issue”.

The spokesperson said the Cambridge and TPO share purchases were aimed at helping the next generation of advisory partners in the respective businesses “continue the high quality advice and service for their clients”.

In a release last week, Scott Alman, Consilium chief, said the firm, which counts about 120 financial advisory practice clients across NZ, could be “an effective conduit for firms considering their succession planning”.

Alman said while many veteran NZ advisers are looking to retire, potential successors often struggle to amass the required buy-out capital.

He said Consilium “can foster the aspirations of these future shareholders as they look to build their shareholding over time”.

“Stability and continuity are important for our independent adviser community to ensure investors can continue to access independent financial advice and the industry is not dominated by only big institutions,” Alman said.

While Consilium has filled the interim capital gap, the spokesperson said both Cambridge – previously known as Bradley Nuttall – and TPO would “continue to operate independently”.

TPO was co-founded by former head of capital-protected funds management firm, Liontamer, Laetitia Peterson, who sold down her shares following the Consilium move.

Peterson remains as a TPO adviser while colleague, Nick Crawford, owns the other half of the business.

Stephen Ambler, Consilium chair, now sits on the boards of both Cambridge and TPO.

Succession planning is a perennial issue in the boutique financial advisory business but the number of founder exits is expected to surge amid an aging adviser population and a tighter regulatory environment.

As a report by NZ financial advice firm, Milestone, documented last year, succession strategies and practice values will vary depending on business type and structure.

Historically, institutions such as AMP, broker-based wealth managers or banks served as end-buyers of advice firms – although the latter group has exited that game.

In more recent years, some novel deals such as the Alvarium acquisition of boutique firm, Newton Ross, have shown a broader appetite for advice businesses.

And last year, FNZ – which provides the investment platform technology for Consilium among many others – took a small slice of Pāua Wealth, an Auckland high-end advisory firm founded by Donna Nicolof.

However, FNZ labelled the Pāua purchase a one-off. At the time, Nicolof said the FNZ capital injection was for growth purposes rather than succession planning.