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May 5, 2020

Wealth manager Kingswood looks to establish US foothold with new deals

Kingswood Group has finalised its purchase of wealth manager Chalice and also inked conditional heads of terms to take a majority stake in Manhattan Harbor Capital.

Under the agreement, Kingswood picked an 85% stake in independent broker/dealer Chalice Capital Partners as well as Chalice Wealth Advisors.

The remaining Chalice shareholder has exercised their put option over the balance holding, with Kingswood now fully owning Chalice.

Kingswood has made an initial payment of $1m for the deal and has paid another $1m now upon deal completion.

It has to pay another $2m for the deal, which will be “disbursed on a deferred basis in 2020” based on the fulfilment of certain asset migration, revenue and EBITDA targets by Chalice.

The deal was announced last December. Chalice has 96 authorised representatives and oversees $1.1bn in assets.

Moreover, Kingswood also looks to raise its holding in Manhattan Harbor Capital (MHC) from 7% to 20%.

Chalice will be folded into Manhattan, boosting Kingswood’s ownership in MHC to 50.2%.

MHC will be rebranded as Kingswood US, which will have a presence in New York, Atlanta and San Diego and 180 authorised representatives.

Kingswood announced its partnership with MHC in May 2019.

As part of the deals, Chalice CEO Derek Bruton will assume the role of CEO of Kingswood US and partner with MHC majority owner Mike Nessim.

Kingswood Group CEO Gary Wilder said: “Kingswood’s enhanced investment in MHC will cement a key, strategic foothold in the largest global wealth and investment management market, differentiate us from our peers and support our aspirations of asset linking and cross-selling services.

“The investment will provide a significant base to potential further integration and a valuable support to Kingswood’s US expansion plans.”

 

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