LSL Property Services has completed of the acquisition of TenetLime Ltd on 2 February 2024. This follows the announcement on 21st August 2023 that LSL had exchanged contracts to acquire the TenetLime network for £12.9m, subject to Financial Conduct Authority (FCA) approval, which has now been granted.
TenetLime operates a network providing services to 231 mortgage and protection advisers, operating within 133 appointed representative firms. Its advisers arranged around £3.9 billion of mortgages in 2022.
The network reported a pre-tax profit of £0.9m for the year to September 2022, when it had gross assets of £10.1m.
The transaction also includes consideration for the recruitment by TenetLime of 47 mortgage and protection advisers operating within 24 appointed representative firms, that are currently members of TenetConnect and TenetConnect Services, that are expected to transfer to TenetLime prior to completion.
The consideration payable is expected to be up to £12.9m consisting of an initial payment of up to £5.6m, calculated by reference to the number of appointed representative firms at completion and the turnover of these firms in 2022
There will be a further payment of up to £4.5m, calculated by reference to the number of appointed representative firms 12 months following completion and the turnover of these firms in 2022; and an expected payment of £2.8m for assets which form part of TenetLime’s regulatory capital.
The total consideration payable at completion is subject to adjustments based on the net asset value of TenetLime at that time.
The acquisition is being financed from LSL’s existing cash resources. At 30 June 2023, the Group had a net cash balance of £36.0m.
After a short period of transition, TenetLime members will be integrated fully in the operations of LSL’s PRIMIS Network. The acquisition allows LSL to leverage its existing network infrastructure to deliver synergies and enhance the Group’s margin.
Jon Round, LSL group financial services director, said: “ I am delighted to welcome the TenetLime businesses and advisers into the PRIMIS Network. It has been a real pleasure for myself and my colleagues to meet so many of the Tenet advisers at our recent series of regional events and we look forward to supporting their 2024 plans.
“PRIMIS has seen significant organic and acquisitive growth over many years and I am pleased to be able to extend the PRIMIS proposition to yet another set of firms and advisers.”
