Fund, corporate and private client services provider JTC has acquired CEES (Corporate Employee & Executive Services) from RBC Holdings (Channel Islands), part of RBC Wealth Management.
The transaction is subject to relevant regulatory approvals and is expected to complete in early Q2 2021.
Established in 2005, CEES is an employee benefits platform with an internationally diverse blue-chip corporate client base. It offers a broad range of employee benefit plans and product structures, specialises in the administration of several asset classes, and provides client support services as well as administration.
Around 180 CEES employees, including the senior management team, will join JTC on completion, becoming part of the company’s Institutional Client Services division.
The consideration for the acquisition comprises £20m in cash funded from the company's existing facilities. In the financial year ended 31 October 2019, CEES achieved £23.5m in revenue and a consolidated loss before tax of £1.2m.
As part of the JTC group, it is expected margins will improve over time. The acquisition will be immediately earnings enhancing and is expected to deliver a return on invested capital in excess of 10% in year 1 and for this to grow significantly in the second and third years of ownership.
CEES' client book consists of more than 430 corporate relationships and 890 plans, with assets under administration of around £11bn.
JTC said the acquisition complements its existing corporate and trustee services and significantly enhances the group’s employee benefits offering, expanding a service line with good organic growth potential.
CEES employees serve a global client base from offices in Jersey, Guernsey, London and Edinburgh and this will support integration onto JTC’s platform.
Staff in Jersey, Guernsey and London will move to JTC premises in those jurisdictions and JTC will take over the Edinburgh office of CEES.
JTC CEO Nigel Le Quesne (pictured) said: "We welcome our new colleagues and clients to the group and look forward to working with the team at RBC to ensure a smooth transition of the business.
"We can see that demand for employee ownership solutions is growing globally and, as well as achieving enhanced financial performance over the medium term once integrated onto the JTC platform, we see medium- and long-term opportunities for good organic growth.”
Collas Crill has advised JTC on the acquisition. The Collas Crill team was led by Group Partner Matt Gilley in Jersey, assisted by Of Counsel Fiona Wilson and Associate Alex Wileman-Smith. Guernsey support was provided by Partner Wayne Atkinson and Associate Ben Le Page.