Wealth management deal activity and deal values have
increased significantly over the past 18 months with the most deals
occurring in the medium and high net worth segments, according to
new research from Scorpio Partnership.
Scorpio’s
2010 Wealth Management Deal Tracker analysed 53 major
deals across international markets between Q3 2008 and mid-Q1 2010
with total deal value amounting to $510.8bn.
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The results challenge observations from
Swiss-based international private banking M&A specialist Ray
Soudah.
In January, Soudah said the number of
transactions were not in excess of normal levels, but people had
become more aware of the deals because the names involved have been
familiar.
Scorpio’s report, focussed mainly on European
and APAC markets, found deal activity rose through 2009 to a peak
in Q4 of 17 deals worth $20.2bn, up from $90m in Q3 2008.
The average price per deal also jumped more
than tenfold over 2009 from $250m in Q4 2008 to $2.9bn in Q4
2009.
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By GlobalDataThe value of the total assets under management
changing hands per quarter rose from lows of $7.8bn in Q1 2009 to
$21.9bn Q4 2009.
In its report summary, Scorpio said it
believed deal making was at the cusp of a period of increased deal
activity as players of all sizes and shape seek to capture
opportunities.
Scorpio said the rise in valuations was driven
by cross-border deals, particularly in access to the future
battleground markets in APAC where average price paid to assets
under management was 6.9%.
Europe had price paid to assets under
management of 2.4%.
Scorpio outlined five factors it believed were
responsible for reigniting deal flows, these included:
- Focus on cross-border deals into markets of
opportunity, particularly APAC - Consolidation and requirement for scale in
domestic markets - The increasing burden and expectation of
regulatory environments - Ensuring access to distribution, particularly
offshore going onshore - Government led attacks on offshore
jurisdictions and the model of offshore
