Moneygate is reviewing its potential bid for Wisbech-headquartered IFA, The Clarkson Hill Group plc.
It claims it has hit a brick wall in its bid to progress talks with Clarkson Hill whose shares have been suspended for a second time in a year.
An upturn in its financial fortunes may have triggered a change of strategy for Clarkson Hill – and the lack of dialogue has certainly spooked Moneygate.
Moneygate said that over the past three months it had been conducting due diligence on Clarkson Hill with a view to making an offer for its ordinary shares.
However, Clarkson Hill last week confirmed that its regulatory permissions had been varied and as a result, it was unable to undertake any regulated activities from 5 pm on December 3.
The variation of Clarkson Hill's regulatory permissions has forced Moneygate to review its position. The company said it had made a number of attempts to talk with the directors of Clarkson Hill over the past two weeks to determine the current position but, “unfortunately, they have yet to re-engage in constructive discussions.”
A statement added: “The directors of Moneygate have a great deal of sympathy for advisers, staff and clients of Clarkson Hill who they believe will be keen to know what the immediate future holds for them.
“Moneygate's management are receiving many calls and emails from Clarkson Hill advisers seeking information. Unfortunately, Moneygate is not currently in a position to answer these queries other than to confirm that it has made an application to the FSA for consent to take a bulk transfer of Clarkson Hill's advisers.”
Financial websites have reported that Clarkson Hill has been in talks with the FSA about its capital adequacy requirements after directors Ron Pritchard and Mike Robinson loaned the business £588,000.
The group requested a temporary suspension of its shares on AIM from November 24, pending clarification of its regulatory position.
The shares were also suspended after it failed to submit its annual accounts in July.
Clarkson Hill announced an upsurge in pre-tax profits for 2010 to £47,853, following a loss of almost £180,000 last year.