Financial services group IFG has made its seventh acquisition of the year, paying £10 million sterling (€16.4 million) in cash and earn-outs for an 80 per cent stake in Nottingham-based financial adviser The ISA Shop.

IFG also has an option to buy the outstanding 20 per cent for a maximum of £6.5 million (€10.6 million) subject to profit targets being reached in the two years to the end of December 2004. The £16.5 million maximum cost would make this IFG's biggest acquisition, ahead of the £12 million (€19.7 million) paid for the Berkeley Jacobs retirement advisory company in September.

IFG's main business in Britain is independent financial advisory services and it specialises in the sale of life assurance, pension and investment products. The group's main aim is to build a national independent financial advisory business in Ireland and Britain. The ISA Shop operates a direct marketing service on single premium investment products, individual savings accounts and insurance company bonds. It was set up in 1997 and began trading in 1998. Because of its high marketing spend and long lead-in time, the company has only begun to generate profits. Last year, it had turnover of £1.75 million sterling and losses of £93,737 but in the nine months to the end of last September it had turnover of £1.75 million and pre-tax profits of £55,701.

IFG's chief executive, Mr Richard Hayes, said: "This acquisition will increase the recurring income receivable in 2001 to in excess of €10 million. This recurring income, which we have grown at a compound rate exceeding 30 per cent over the past five years, now has a net present value of more than €3 per share."