Investec's Evolution deal hits regulatory roadblock

The final sign off of Investec's £220 million bid to take on Evolution Group has been postponed because regulations imposed on the deal by the Financial Services Authority (FSA) have not been satisfied.

The deal, which saw Investec fend off a rival offer from Canaccord, was due to be given the green light at a court hearing today.

However, London-based broker Evolution and Investec both declared the hearing had been adjourned until 21 December after postponement was sought by Evolution.

'This adjournment, which was sought by Evolution with the agreement of Investec, has been obtained in view of certain regulatory conditions to the scheme, namely the approval of the FSA, Central Bank of Ireland and Hong Kong Securities and Futures Commission, having yet to be satisfied,' the two firms said. 

They added: 'Evolution and Investec are hopeful that these remaining conditions will be satisfied shortly although the statutory time limit within which the FSA must respond does not expire until 29 December 2011.'

In October, a separate hearing saw Investec's shareholder's vote largely in favour of the investment bank's all share offer for Evolution. 

But while consensus expected the deal to be given the initial sign-off by a majority of investors, earlier in the same month Evolution's largest shareholder, Aberforth Partners, withdrew its support for the bid.

There have also been indications that once the deal goes ahead Investec will seek to ensure cost synergies.  Wealth Manager revealed in November that up to 100 staff at Investec had entered into consultation about their future positions at the company.

Shortly after announcing the postponement, Investec and Evolution issued a further joint update that unveiled approval for the bid from the Securities and Futures Commission of Hong Kong.  This means the two companies are waiting on approval from the FSA, Central Bank of Ireland and the sanction of the court.