M&G plans European expansion with minority stake in digital wealth manager – International Investment

UK headquartered funds firm M&G has taken a minority stake in digital wealth manager Moneyfarm as part of a broader partnership which will see the launch of a “new investment solution”.

M&G will use Moneyfarm’s ‘platform as a service’ to offer an innovative, digital product aimed at the next generation of retail customers in the UK.

Moneyfarm and M&G will also explore a range of other opportunities to partner in other European wealth markets.

MFM Holding (Moneyfarm), the digital wealth manager said on 26 January that it has agreed a funding round raising £44.1m, led by M&G and including Poste Italiane S.p.A (Poste), which has been a minority shareholder in Moneyfarm since 2019.

Since it launched in 2012, Moneyfarm has raised £139m.

The new funding round will be used in three key areas, to support future development, expanding its product proposition and building out its new B2B2C proposition through strategic partnerships.

The private placement will be completed by the end of the first quarter of 2022, subject to regulatory approvals and will see M&G, a leading international savings and investment business, with over £370b of assets under management and administration, acquire a minority stake in Moneyfarm.

In 2021, Moneyfarm saw assets under management increasing 72%, positive net inflows of 128% and a 73% increase in new customers compared to 2020. Moneyfarm now has over 80,000 clients and over £2.2bn in AuM.

In addition to the fund raise, Moneyfarm and M&G signed a commercial partnership for the launch of a new UK digital investment solution under the M&G Wealth brand. 

Designed by M&G Wealth, the new direct digital service will be tailored to meet a range of customer risk appetites and profiles through a collection of multi-asset model portfolios, backed by a selection of actively-managed and passive funds.

This B2B2C commercial agreement, the first of its type in the UK for M&G, reinforces the strength of Moneyfarm’s business model. Moneyfarm already has a number of successful B2B2C partnerships in Italy including Poste Italiane (Postefuturo Investimenti), Unicredit’s Buddybank (Steppy by Moneyfarm) and Banca Sella (Sella Evolution powered by Moneyfarm), serving thousands of customers.

Direct investing in the UK has seen rapid growth in the last five years, with an average annual increase in assets under management of 18% to reach £351b by the end of June 2021. Within this sector, demand for digital investment services has accelerated, and now accounts for 19% of all UK direct customers. Moneyfarm is considered one of the pioneering providers of this emerging segment of the market, offering a modern approach to investing through its proven …….

Source: https://www.internationalinvestment.net/news/4043877/plans-european-expansion-minority-stake-digital-wealth-manager