Investec wealth arm to merge with Rathbones in £839m deal

The UK wealth business of Investec and Rathbones have agreed to merge in an £839m all-share deal, the two companies said on Tuesday.

New Rathbones shares will be issued for 100% of Investec Wealth & Investment shares, which would leave Investec with an economic interest of 41.25% in the combined company and voting rights limited to 29.9%.

The enlarged Rathbones Group will create the UK's leading discretionary wealth manager with approximately £100bn in funds under management and administration, the duo said in a statement. However, the deal does not include Swiss-based Investec Bank or the international wealth business, both of which remain wholly-owned subsidiaries of the broader Investec Group.

There was no mention of job losses, but the two firms said they were targeting annual run-rate cash synergies of at least £60m, "driven primarily by cost savings as well as higher net interest income".

Reporting by Frank Prenesti for Sharecast.com