NatWest Group is considering a bold takeover bid for one of Britain’s biggest wealth managers in a deal that would represent its biggest corporate acquisition since it was bailed out by taxpayers nearly 15 years ago .
Sky News has learned that NatWest is in the early stages of considering a bid for Tilney Smith & Williamson, which is being put up for sale by its private backers.
City sources said the street lender, which remains minority state-owned, was among a significant number of banks and financial investors likely to explore deals for Tilney.
The wealth manager, which manages more than £57bn for its clients, is owned by buyout companies Permira and Warburg Pincus.
It is expected to fetch between £2.5 billion and £3 billion in a sale.
Both owners have appointed investment bankers at Evercore to consider a sale or IPO of the company, although the latter option may have been derailed by market volatility exacerbated by the invasion of Ukraine by Russia, according to insiders.
A sales process for Tilney – which will be renamed Evelyn later this year – is expected to start within the next six weeks, they added.
Warburg Pincus may acquire Permira’s stake, Bloomberg News reported earlier this year, although a number of other major banks are also expected to take a close look at Tilney.
Alison Rose, chief executive of NatWest, is said to be keen to expand the group’s presence in wealth management, where it owns the Coutts brand.
It’s unclear how any acquisition of Tilney, which also owns the BestInvest platform, might fit into NatWest’s existing wealth management operations.
Still, the fact that NatWest should seriously consider an offer for Tilney underscores his recent resurgence.
He hit a major milestone this week when a directed buyout of his shares reduced the government’s stake to less than 50% for the first time since he was bailed out with £45.5billion of government money. taxpayers in 2008 and 2009.
For much of its first decade in state stewardship, the bank – then known as the Royal Bank of Scotland – was banned from making acquisitions altogether.
Since those handcuffs were removed, he has purchased a small number of companies in the fintech sector as well as larger mortgage and asset portfolios.
It made nearly £3bn in profits last year as the banking sector recovered from the chronic uncertainty it faced at the start of the pandemic.
Nonetheless, it now has a market value of £23billion, barely half of what the taxpayer paid to save it from collapse.
Fred Goodwin, the chief executive at the time of the government bailout of RBS, became a fearless dealmaker who vastly expanded his balance sheet, leaving him vulnerable to the global financial crisis.
NatWest is also bracing for changes at the top, with chairman Sir Howard Davies set to step down within the next two years.
Sky News revealed earlier this year that the bank was preparing to appoint headhunters to identify its successor.
NatWest declined to comment this weekend.