FINANCIAL service company IFG has acquired Isle of `Man' based trustee services company, Europa, for £1.1 million sterling.

IFG has made an initial cash payment of £400,000 and the balance will be paid in two equal cash instalments of £350,000 in May 1997 and May 1998.

Set up in October 1987, Europa reported pre-tax profits of £187,079 on a turnover of £1.37 million for 1995. The company provides administrative and trustee services to the timeshare industry.

IFG is paying 5.8 times pretax earnings for the company which had a net deficit on shareholders funds of £90,065 at the end of 1995.

IFG chief executive, Mr Richard Hayes said the acquisition was being funded out of cash flow. IFG expects to make significant cost savings through the amalgamation of Europa with its existing Isle of Man business, First National Trustee Company (FNTC). Some of the Europa's 20 employees are expected to lose their jobs.

Europa's office in Ramsey will be closed and the operation moved to the FNTC office in Douglas. The three owner directors of Europa have signed three year contracts with IFG and will join the FNTC board.

The amalgamated operation will have a client base of 240,000 people owning over 300,000 timeshare properties.

The acquisition will not be earnings enhancing in the current year. But Mr Hayes said he expected it to add about £400,000 to group profits by 1997.

Last month, IFG reported a 5.3 per cent rise in pre-tax profits to £1.07 million for 1995 on sales which were 3.8 per cent higher at £12.7 million. Shareholders funds rose from £980,000 to £2.9 million.