Natwest sells HR advisory arm in latest structure overhaul
Natwest has sold its human resources advisory arm to a private-equity backed rival in the latest deal by the banking giant on the road to streamlining its operations.
The FTSE 100 titan has offloaded Mentor – its small business HR support service – to Empowering People Group, a specialist HR service backed by Limerston Capital.
Limerston created the group through its 2016 acquisition of Adviserplus and subsequent add-ons of legal and employment firms including Halborns in 2020 and Learning Nexus in 2022.
Mentor holds a customer base of around 100,000 small and medium-sized business customers and takes a focus on employment law, HR, health and safety and environmental compliance.
The terms of the deal have not been disclosed. The some 220 people working at Mentor are expected to be transferred to the new owner as part of the deal.
Natwest shakes up structure
The deal marks the latest in a string of manoeuvres by Natwest boss Paul Thwaite to tidy up the business’ structure.
Last year, the bank offloaded its workplace pensions fintech Cushon to Willis Towers Watson.
Thwaite’s have targeted a more active balance sheet and moves into areas that offer a more stable source of income such as wealth management.
Banking giants have ramped up pushes into wealth in the last year with the division offering lenders a less volatile and more capital-light source of income, due to its reliance on recurring fees rather than the interest rate fluctuations that affect traditional lending.
Natwest splashed a whopping £2.7bn – its biggest deal since the financial crisis – to snap up Evelyn Partners in February, taking the wealth manager out of the hands of private equity owners Permira and Warburg.
Thwaite described the move as creating the “third growth engine” for the group with Evelyn’s £69bn assets under management under the the Natwest umbrella making it the largest of the bank-owned wealth managers with a total of £127bn assets.
The move did provide markets with some jitters, however, as Natwest hit pause on future buybacks and revealed plans of £150m of spending – with potential to climb if the integration doesn’t go smoothly – to cut costs by around £100m annually.