NatWest Group is also nearing a £2.5 billion ($3.4 billion) takeover of the wealth management group Evelyn Partners, the largest of its corporate takeovers since its bailout by taxpayers in 2008.
Sky News has informed that NatWest, which returned to full private ownership last year, is in advanced talks to acquire Evelyn from its private equity backers.
Competition between NatWest and competitor Barclays is perceived to have been fended off by the former in recent days following a fresh wave of bids last week.
City sources suggested that NatWest would pay between £2.5 billion and £3 billion to acquire Evelyn, providing a wide spectrum of wealth management services to thousands of customers.
The announcement confirming the agreement could come in the early part of next week. The acquisition of Evelyn, which was previously known as Tilney Smith & Williamson, was to enhance NatWest’s presence in one of the areas identified by Paul Thwaite, its chief executive, as a priority for the bank.
NatWest, predicted to announce robust full-year outcomes at the conclusion of next week, has been on a simplification quest since Mr Thwaite took over leadership in 2023.
Analysts indicated that the acquisition of Evelyn would be a rational strategic step towards NatWest’s Coutts division and the high-end customer market. It is a large transaction, but a price of less than £3 billion is small when measured against the market capitalisation of nearly £52 billion of NatWest.
Its stocks have increased by approximately 50 percent within the past year. Barclays also expressed interest in acquiring Evelyn, but it is claimed to have withdrawn from a deal after becoming aware that the price that had been offered by competitor NatWest to acquire the business.
Royal Bank of Canada had been associated with a bid, but it was not clear whether an offer had been tabled by the bank this week. Evelyn manages nearly £65 billion in assets as of last August, when it announced half-year results, which is a major sector player in the UK.
Evelyn is auctioned during a storm of corporate action within the wealth management industry. The trend has been fuelled by demographics and the need to move Britons towards longer-term saving, investment, and financial planning over the past few years, which is projected to be maintained over the coming years as well as in many areas of the industry.
However, Canaccord Genuity’s wealth arm is also on the block and might fetch a price of over £1 billion. The acquisition of Evelyn will also lead to going back to NatWest by the chief executive of Evelyn, Paul Geddes, if he is still a part of the business.
Mr Geddes joined the then Royal Bank of Scotland before the financial crisis, operating its insurance arm, including brands such as Direct Line and Churchill. He presided over the spin-out of the high street lender, which was at the time majority owned by the government.
The private equity firms Permira and Warburg Pincus are the owners of Evelyn, which combined their respective firms Tilney and Smith & Williamson in 2020. In the previous year, the professional services division of Evelyn was acquired by the buyout firm Apax Partners.
The auction of the wealth management business is being handled by bankers at Evercore. Both NatWest and Barclays refused to comment, and Permira has been approached to comment as well.
