STOCKBROKER brothers Graham and Andrew Waddell, whose grandfather founded venerable Speirs & Jeffrey, look to have realised nearly £35 million from the sale of the Glasgow-based company to Rathbone Brothers.

Speirs & Jeffrey, which has £6.7 billion of funds under management, has been sold to London-based wealth and investment manager Rathbones for an initial £104m. Rathbones currently has £3bn of funds under management in Scotland.

Based on the most recent Companies House filings, Speirs & Jeffrey shareholders Graeme Dickie, Michael Wilson and Russell Crichton also each look to have reaped an initial £16m from the deal.

Speirs & Jeffrey, founded 112 years ago, will continue to operate as a standalone company until next June when the business and its clients migrate into Rathbones. The business will then be known as Rathbones Scotland.

All of Speirs & Jeffrey’s directors and investment managers – including the Waddell brothers – will join Rathbones, with chief executive Mr Crichton heading up Rathbones’ Scottish business. Rathbones’ Glasgow team will move to Speirs & Jeffrey’s premises in Glasgow’s George Square.

Employees of Speirs & Jeffrey will also benefit from the deal, sharing a sum in the region of “several millions of pounds”.

The initial consideration of £104m includes £79m in cash to be funded in part by a proposed £60m equity placing and the issue of one million new Rathbones shares worth £25m.

Rathbones said “further contingent consideration, earn-out payments and incentivisation awards of up to 5.8 million Rathbones shares may also be payable depending upon the achievement of synergies that deliver additional earnings accretion.”

Rathbones will increase its funds under management by 18% to £44.5bn as a result of the deal. Philip Howell, the firm’s chief executive , described Speirs & Jeffrey as “very much a lookalike company” and similar to Rathbones in terms of its investment and management philosophy, as well as its desire to put clients firsts. “There is real commitment to Scotland from Rathbones and it lays down the gauntlet for the industry in Scotland,” he said.

“At the moment there is a huge amount of change in our industry and a lot of companies competing with each other but the tectonic plates are shifting. This move is an ideal fit as we both have a similar client base and both are proud of their heritage.”

Admitting he had “some regrets” that the Speirs & Jeffrey name will disappear, Mr Crichton said it was the right thing to do. “We’ve reached that middle ground where we are too large to be a boutique company but too small to progress the way we want to as we are,” he said, confirming that Speirs & Jeffrey had instigated the acquisition after approaching “a handful” of firms a year ago after bringing in advisers.

“We identified Rathbones as the best fit for us at an early stage in the process because of our synergies,” said Mr Crichton. “With regulatory changes and the need to invest heavily in technology, our clients will benefit from Rathbones’ deeper resources and specialists offerings that Speirs & Jeffrey doesn’t have – a dedicated charities team, for example, and specialists in ethical investment.

“Over time, this will lead to better investment returns for our business.”

In the financial year to May 10, Speirs & Jeffrey recorded profit of £7.2m on revenue of £25.3m.

The acquisition is subject to approval by the FCA and is expected to complete in the third quarter.