Rathbones Group and Investec have entered into an all-share combination of Rathbones and Investec Wealth & Investment to create a £100bn discretionary wealth management business.
The businesses said the combination brings together two of the biggest wealth management businesses in the UK with "closely aligned cultures and operating models and a shared commitment to client-centric values and sustainable growth".
Rathbones said the combination represented a significant "value creation opportunity" for both Rathbones and Investec Group shareholders.
Rathbones chair Clive Bannister said: "Bringing Rathbones together with Investec W&I UK will create the UK's leading discretionary wealth manager with approximately £100bn of funds under management and administration.
"This transaction not only presents a compelling strategic and financial rationale but also accelerates Rathbones' growth strategy.
"Operating at scale allows the group to offer an even more attractive proposition to clients and colleagues, supporting future growth and creating significant value for Rathbones' shareholders I look forward to Investec W&I UK colleagues joining the enlarged Rathbones Group, and welcome Investec Group as a strategic shareholder. I am hugely excited about what the combination can deliver."
Investec Group chief executive Fani Titi said: "The combination of Investec W&I UK and Rathbones brings together two businesses which have a long-standing heritage in UK wealth management and closely aligned cultures.
"The strategic fit of the two businesses is compelling with complementary strengths and capabilities to enhance the overall proposition for clients.
"This will be supported by the strategic partnership which offers attractive growth and collaboration opportunities for both groups. The transaction represents a real step-change and long-term opportunity for our UK wealth strategy, underscores our commitment to the UK wealth management market and enhances our UK business as a whole."
Investec Group will become a strategic shareholder in the enlarged Rathbones Group and, on completion, will enter into a relationship agreement.
The enlarged Rathbones Group will operate under the Rathbones brand, "recognising Rathbones' long-established and prestigious brand in the UK wealth management sector", the business said in a statement. It added: "Investec W&I UK's standalone branding will be phased out following an appropriate transitional period."
Investec W&I UK CEO (subject to regulatory approval) Iain Hooley added: "We are excited to be combining with Rathbones, a business with a similar heritage, common vision and a shared culture. As a combined business, we will have true scale, an enhanced client proposition, and complementary multi-channel distribution capability.
"The long-term, structural growth opportunity in the UK wealth industry is compelling and together we will be well placed to capitalise on it. We look forward to working with the Rathbones management team to complete the transaction and bring the two organisations together."
