Brooks Macdonald

Last updated

Brooks Macdonald Group plc
Company type Public
LSE:  BRK
Industry Wealth Management
Founded1991;33 years ago (1991)
Founders
  • Chris Macdonald
  • Jonathan Gumpel
  • Richard Spencer
  • Martin Mullany
Headquarters London, United Kingdom
Key people
  • Andrea Montague (CEO Designate)
  • Maarten Slendebroek (Chair)
Products
Revenue£128.48 million (2024) [1]
£6.58 million (2024) [1]
AUM £17.9bn (March 2024) [2]
Number of employees
c. 450 (2024) [1]
Website www.brooksmacdonald.com

Brooks Macdonald Group plc is a British wealth management company headquartered in London [3] with eleven offices across the UK. The company provides discretionary investment management, financial planning, and fund management services for private high net worth individuals, pension funds and institutions. BM run a growth strategy called “growth by acquisition” where they purchase other smaller funds, often those in financial trouble. They have thus been involved in scandals such as the “Spearpoint Legacy Issues” where having bought troubled fund Spearpoint, they then refused to pay their new clients (the victims owed money by Spearpoint for negligence and mis-selling risk) - using courts to push down fair settlements.

Contents

The Jersey Financial Services Committee published a damning finding of BM’s guilt and liability in this matter on the JSFC website dated 23/10/20. Source this reference by searching on that date and the BM name to bring up the JSFC report - which can move URL as subsidiaries change names. BM still fight their victims in court to this day. Their CEO Andrew Shepherd, like Caroline Connellan before him, has recently resigned; and multiple high level staff leave regularly - such as Priti Verma their CFO, and many others joined her in 2020. City newspapers covering these stories show to date about £22m of compensation (often referred to as “goodwill payments” by BM) paid out since 2020. BM do not state in their public report and accounts (on their website) how much is payable were BM made to pay all these liabilities in full. BM refer to this potential liability as the “Client Compensation Risk” (CCR). This is the in-house term for that part of this larger liability which they may be forced to pay out to claimants who become aware they are owed this debt and bring claims in court. It is irregular to estimate a liability as what might be payable should one succeed in minimising the liability by court action. Shareholders are therefore given an underestimate of the full liability and are quoted the CCR instead. It is entirely possible that paying what is owed in full would cause BM’s bankruptcy, and that, as such, they may be currently trading as technically insolvent. BM reports and accounts show revenue dropped to just £600,000 after just one large compensation payout following the JSFC report of 2020. [Ref: These financial data are all available on the BM website in the published report and accounts as well as per JSFC as above.]

History

Founding and listing

Initially named Brooks Macdonald, Gayer & Co, the company was founded in 1991 by Chris Macdonald, Jonathan Gumpel, Richard Spencer and Martin Mullany. [4]

By 1993, the company reached £250 million in funds under management. [4] In 2002, the company incorporated Brooks Macdonald Group plc. [5]

The company began trading on the Alternative Investment Market of the London Stock Exchange (AIM) in 2005. [6] Chris Macdonald was CEO of the listed business.

2000-2009

Funds under management by Brooks Macdonald exceeded £1 billion in 2007, [7] the business opened a Manchester office in the same year. [4]

In 2008, Chris Macdonald stepped back from his role as Chief Executive Officer and Managing Director. Macdonald remained CEO but Nick Holmes and Andrew Shepherd were appointed as joint managing directors. [8]

In 2009, Brooks Macdonald completed its first major acquisition, purchasing UK-based fund manager Lawrence House. [9] In in the same year, the company opened its first branch in Scotland. [10]

2010-2019

The company made its second major acquisition in 2010, purchasing property firm Braemar Group. [11] In 2010 funds under management exceeded £2 billion for the first time. The company paid its first dividend in this year. [4]

In August 2011, the company acquired the investment arm of law firm Clarke Willmott, gaining £120 million of discretionary client assets [12] in the transaction. In the same year, Brooks Macdonald unveiled a new funds business which had £100 million in assets under management at launch. [13]

Funds under management for the company surpassed £3 billion [4] in 2012. In November of that year, Brooks Macdonald acquired Spearpoint, a discretionary fund management service provider based in the Channel Islands. [14]

Brooks Macdonald acquired DPZ Capital [15] and Levitas Investment Management Services [16] in 2014, taking funds under management to a total of more than £6 billion. [4]

Andrew Shepherd was promoted to Deputy Chief Executive [17] in August 2015.

In April 2017, Chris Macdonald stepped down as Chief Executive. Caroline Connellan was announced as his successor. [18] In the same year, Brooks Macdonald opened its first office in Wales. [19]

In March 2019, Andrew Shepherd was appointed CEO of Brooks Macdonald International. [20] Later that year the company acquired Scotland-based Cornelian Asset Managers, the acquisition increased Brooks Macdonald's funds under management by around 10%. [21]

2020-present

In 2020, Brooks Macdonald acquired Lloyds Bank International's offshore management and funds business. [22]

Andrew Shepherd was appointed Brooks Macdonald Chief Executive Officer the following year, succeeding Caroline Connellan who departed the business. [23]

Brooks Macdonald acquired Warwickshire-based independent financial adviser Integrity Wealth [24] in September 2022. In the same month the company announced the purchase of Manchester-based Adroit Financial Planning, adding a further £350 million in assets under management to the firm. [25]

Also in September it was reported that the company had responded to the cost of living crisis by giving staff who were earning £50,000 per year or less a £1,000 pay rise to combat the increase in utility price cap. [26]

In August 2023, the company partnered with UK charity Family Business United, supporting the financial planning and investment management of 250 companies in the UK. [27]

In March 2024, the international division of Brooks Macdonald was placed under review. [28] In June, Andrew Shepherd announced his decision to retire. Chief Financial Officer Andrea Montague was announced as his successor. [29]

Current operations

As of March 2024, Brooks Macdonald has £17.9 billion in funds under management. [30]

Management and governance

Having founded the business in 1991 alongside Richard Spencer, Jonathan Gumpel and Martin Mullany, [4] Chris Macdonald served as Chief Executive Officer for 25 years before he was succeeded by Caroline Connellan in April 2017. [31]

In 2018, Connellan joined the board of the British trade association Investment Association, representing the investment management industry in the UK. [32] Connellan left the company in 2021, replaced by Andrew Shepherd [23] who had previously served as managing director [8] and deputy Chief executive [17] since joining Brooks Macdonald in 2008. Shepherd was the company's CEO until 2024, when he announced his retirement. Andrea Montague, who had served the business as CFO was named as his successor. Montague is currently Chief Executive Officer Designate, ahead of formally becoming CEO in October. [29]

In 2023, Maarten Slendebroek was appointed Chairman and non-executive director following the departure of Richard Price; [33] Andrea Montague was appointed executive director and Chief Financial Officer. [34]

In 2024, Alex Charalambous was appointed head of wealth, [35] while Richard Larner and Michael Toolan were appointed Co-Chief Investment Officers succeeding Edward Park. [36]

Founder Richard Spencer remains at the firm as Senior Adviser to the Investment Committee. He has previously served at Chief Investment Officer. [37]

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References

  1. 1 2 3 "Brooks-Macdonald-plc". Financial Times.
  2. ↑ O'Connor, Tara (17 April 2024). "Funds under management rise for Brooks acdonald despite outflows". FT Adviser.
  3. ↑ Angier, George (13 February 2023). "Brooks Macdonald names Leeds and Manchester Investment heads". Portfolio Adviser.
  4. 1 2 3 4 5 6 7 Bucak, Selin (26 October 2016). "How Chris Macdonald built Brooks into a 9bn company". Citywire Wealth Manager .
  5. ↑ "Brooks Macdonald Asset Management Limited". Gov.uk.
  6. ↑ Dorrell, Chris (27 February 2023). "Brooks Macdonald chair Carruthers resigns due to ill health". City AM.
  7. ↑ Owen, Christopher (22 January 2008). "Brooks Macdonald Breaks Billion Barrier". WealthBriefing.
  8. 1 2 Campbell, David (30 October 2008). "Christopher Macdonald steps back from dual role at Brooks Macdonald". Citywire Wealth Manager.
  9. ↑ Parker, Charlie (7 September 2009). "Brooks MacDonald acquires Lawrence House fund managers". Citywire Wealth Manager.
  10. ↑ Levy, Danielle (20 July 2009). "Brooks MacDonald to launch Edinburgh operation". Citywire Wealth Manager.
  11. ↑ Goodburn, Matthew (8 June 2010). "Brooks MacDonald's £4 million cash offer for Braemar Group accepted". Citywire Wealth Manager.
  12. ↑ Parker, Charlie; McGagh, Michelle (5 August 2011). "Brooks MacDonald gains £120 million buying Clarke Wilmott". Citywire Wealth Manager.
  13. ↑ Lobo, Dylan (4 July 2011). "Brooks Macdonald unveils £100m funds business". Citywire Wealth Manager.
  14. ↑ Miloudi, Sarah (16 November 2012). "Brooks' FUM to hit £4.5bn on Arch Cru fund manager buyout". Citywire Wealth Manager.
  15. ↑ Lobo, Dylan (14 April 2014). "Brooks Macdonald buys Jersey wealth firm DPZ Capital". Citywire Wealth Manager.
  16. ↑ Little, Stephen (1 August 2014). "Brooks Macdonald Completes Levitas Acquisition". Wealth Briefing.
  17. 1 2 Philipps, James (4 August 2015). "Brooks Macdonald appoints deputy chief executive". Citywire Wealth Manager.
  18. ↑ McGachey, Kristen (11 April 2017). "Brooks Macdonald CEO passes reins to Connellan". Portfolio Adviser.
  19. ↑ Fantato, Damian (31 July 2017). "Brooks Macdonald hires ex-rugby player for Welsh Office". FT Adviser.
  20. ↑ "Andrew Shepherd named CEO of Brooks Macdonald International". Channel Eye. 30 March 2019.
  21. ↑ Tew, Imogen (22 November 2019). "Brooks Macdonald buys Edinburgh DFM". FT Adviser.
  22. ↑ Tew, Imogen (24 June 2020). "Brooks Macdonald buys Lloyd's wealth management arm". FT Adviser.
  23. 1 2 Hickey, Sally (17 May 2021). "Brooks Macdonald appoints CEO as Connellan steps down". FT Adviser.
  24. ↑ Hinchliffe, Ruby (15 September 2022). "Brooks Macdonald shirks 'IFA consolidator' label but eyes more deals". FT Adviser.
  25. ↑ Matthews, Jane (30 September 2022). "Brooks Macdonald buys Manchester-based IFA". FT Adviser.
  26. ↑ McGachey, Kristen (21 September 2022). "Brooks Macdonald hikes pay for low earners to combat cost-of-living crisis". Financial News.
  27. ↑ Kyriakou, Simoney (21 August 2023). "Brooks Macdonald to be wellbeing partner for UK family firms". FT Adviser.
  28. ↑ Mendel, Jack (7 March 2024). "Brooks Macdonald: Wealth Manager puts 'behind plan' international arm under review". City AM.
  29. 1 2 Brown, Jenna (24 June 2024). "Brooks Macdonald names Andrea Montague as next CEO". Investment Week.
  30. ↑ O'Connor, Tara (17 April 2024). "Funds under management rise for Brooks Macdonald despite outflows". FT Adviser.
  31. ↑ Shepherd, Damian (17 May 2021). "Standard Life Aberdeen appoints Caroline Connellan as new CEO of personal wealth". City AM.
  32. ↑ Harrison, Peter (19 September 2018). "Three more women join board of Investment Association". Financial Times.
  33. ↑ Williford, Hannah (27 November 2023). "Brooks Macdonald appoints former Jupiter CEO Maarten Slendebroek as chair". Portfolio Adviser.
  34. ↑ Rach, Sonia (15 June 2023). "Brooks Macdonald appoints CFO". FT Adviser.
  35. ↑ McQuaid, Darius (21 March 2024). "Brooks Macdonald hires Charalambous to newly created head of wealth role". Money Marketing.
  36. ↑ Hug, Caroline (31 January 2024). "Brooks Macdonald names two CIOs to replace Park". Citywire.
  37. ↑ Esnerova, Daniela (24 September 2020). "Brooks Macdonald co-founder Spencer steps down as CIO". Money Marketing.
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