Options parent acquires Mercer SIPP business in £3.3m deal

STM Group, parent company of SIPP provider Options, has agreed to acquire the SIPP and SSAS portfolio of US asset manager and pension consultancy Mercer. The international SIPP and financial services provider will pay £3.34m for the portfolio, net assets and trustee companies of Mercer’s UK SIPP and SSAS business. It will add 2,100 SIPPs and 700 SSAS to Option’s UK portfolio. The deal is expected to complete on 31 August. STM said the deal will doubt the revenue generated from its UK personal pensions business. It added that the portfolio will also give Options access to an expanded network of intermediaries who have introduced clients to Mercer. The portfolio generated £0.87m EBIT for the financial year ended December 2021 and is expected to contribute a similar annual amount to Options following a 12-month integration process. Options will retain Mercer’s office premises in Cardiff as well as existing staff members. The deal is not subject to regulatory approval as STM is not acquiring the regulated entities themselves. It will be funded from existing financial resources and a remaining available debt facility previously arranged with STM’s bank. Additional acquisition and integration costs are expected to cost STM £0.3m for the four months to 31 December. Alan Kentish, CEO of STM, said: “The revenue generated by this portfolio will mean that our Options personal pension solution business in the UK will effectively double in size and will give us a new centre of excellence for our SSAS business. “The business is well run by the team in Cardiff. This allows us to implement an integration plan that can dovetail with our overall plans in relation to changing our operating model to improve our margins, post significant investment in our IT infrastructure.” STM Group’s UK arm Options was formerly known as Carey Pensions. The firm acquired Carey UK Pensions LLP in February 2019, and has been fighting a long-running landmark legal base which question provider responsibility when accepting investments into a SIPP. The Supreme Court ended the long-running case in April when it denied STM permission to appeal following a ruling from the Court of Appeal last year which ruled in favour of the claimant who had lost money after making a high-risk, unregulated investment through his SIPP. The Supreme Court is the final court of appeal in the UK legal system, therefore the appeal denial is likely to end the long-running sage relating to an investment made in 2012. The original case was heard in March 2018.

Options parent acquires Mercer SIPP business in £3.3m deal

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