Business

Families back wealth management platforms

The Hinduja family has struck a deal with Focus Financial Partners to create a multi-family office that will provide access to interesting deals for its clients.

It is the latest of several moves by wealthy families who have used the pandemic to reflect on expansion opportunities. According to Credit Suisse, in 2019, the top 1% of the wealthy control 50% of global assets, so it makes a great deal of sense to fish in their own waters. 

Many opportunities comprise market luxury goods whose cash flows have grown with their customers, far removed from the pains of the High Street. 

The S&P Global Luxury Goods index has produced an annualised 13.3% over ten years to February against 9.4% from the S&P Global index. Over one year, it returned a staggering 62%, against 32%) against 32%. 

Families who cashed out during the tech boom are particularly well placed to use monetary and fiscal stimulus as leverage to participate in deals, while pension schemes are too mature to care. Recruitment of legal expertise has stepped up. 

According to Talis Capital, family wealth has cascaded from one deal to another, leading to the growing sway of family offices in venture capital. A growing number of family offices in Europe are interested in co-investment, drawing on the Pritzker Private Capital playbook.  Considered investment in secondary private equity has become frequent along with SPACs and direct deals  

The Hinduja family is worth $18 billion, according to Bloomberg. Their philosophy is guided by a belief, occasionally disputed, that assets held by one family member belong to all. The business is run by a second-generation quartet of brothers, comprising Gopichand, Srichand, Prakash and Ashok. 

The family has its roots in trade between India and Iran in the days of the Raj. It now invests in a vast range of businesses in 38 countries in sectors like finance, media and health care. The Hinduja brand, and its connections, will resonate with clients of its MFO, Beryllus Capital led by Amit Kotha, a former RBC private client director.

Gopichand Hinduja said: “This is an important strategic alliance. Beryllus will address the bespoke needs of ultra-high net worth families on a global scale.”

As well as investing, the MFO will offer to manage the complexities of personal and professional lives.

Other deals to emerge in March include moves by US-listed SPAC to buy from Blackstone control of Luxembourg-based Lombard International, a global tax and wealth planner advising on $49.3 billion. 

The SPAC is led by Kingswood Group’s Gary Wilder, Michael Nessim, CEO of Benchmark Investments and Larry Roth, adviser to US financial advisers via Berkshire Global and RLR Strategic Partners.

 

 

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