The deal, subject to regulatory approval, would see Tilney Bestinvest acquire Towry from its majority shareholder Palamon Capital Partners for £600m.
The combined company would have responsibility for more than £20bn of assets for affluent and high net worth clients.
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Announcing the deal, Tilney Bestinvest said it would continue to use the Towry, Tilney and Bestinvest names in different areas of the market while a brand review is undertaken.
The combined business would comprise 240 financial planners and 120 investment managers operating in more than 30 offices across the UK.
Peter Hall, Tilney Bestinvest's chief executive, will take up the same position in the combined company.
He described it as a “transformational deal that will position the combined group as one of the leading UK wealth management firms”.
He added: “Recent changes to pensions have increased further the need for high quality financial advice and investment management and together we will be well placed to help people in this complex area.
“The combination of Towry and Tilney Bestinvest is compelling because both firms share a culture of aiming to provide the very highest levels of professional and personal client service.”
It first emerged that Palamon had appointed Evercore to oversee the sale of Towry in December. Tilney Bestinvest was advised by Citi.
Daan Knottenbelt, partner at Palamon, said: "It has been a tremendous experience to have executed a transformational growth strategy that saw Towry develop from a single office IFA in Marlow with £5m of revenue to become one of the nation’s leading national wealth managers with revenues of more than £120m and over £9bn of assets under management."