Property investment group MFS beat out at least one other Australian firm with its successful NZ$52.5 million purchase of New Zealand financial planning firm Northplan yesterday.
The purchase figure, which surprised most local players, is the highest paid for a New Zealand financial planning operation since Axa paid over $245 million in 2001 for the Sterling Grace group, which included Spicers and the Australian Monitor Money group. Earlier this year another Australian firm, the Perth-based Plan B, bought a stake in two smaller New Zealand financial planning firms. Australian interest in financial planning firms across the Tasman has been heightened by coming regulation of the advisory industry and new investment tax rules. Kelvin Syms, Northplan founder and chief, said the deal would enable the business to double in size in the next two and a half years. “As a small private company we had limited access to capital,” Syms said. He said Northplan had several other suitors including another Australian financial services group, which he declined to name. MFS does not own distribution in Australia but has signalled an intention to build a diversified financial services business in New Zealand after selling 60 per cent of its assets in that country in June to a group of private equity investors that included Babcock & Brown. Northplan itself sold a 25 per cent stake of its business just under a year ago to the St Laurence Private Equity Fund, a group related to the St Laurence finance company, for an undisclosed sum. According to Syms, the Northplan business was built along the model of Australian groups such as AWM, which was one reason MFS “paid serious money” for the group. “MFS didn’t buy a business based on EBIT but for a company that was building to the Australian model,” he said. Northplan has NZ$1 billion in funds under advice and management across its nine offices, and other smaller financial planning practices it has part-ownership of. Syms said Northplan also provides back-office services to other financial planning groups. In a statement released yesterday, Jason Maywald, MFS New Zealand chief executive, said the Northplan deal was the first in a planned series of purchases in the country. “We are very excited by this opportunity which will not only allow for the enhancement and acceleration of Northplan’s own expansion plans but will also provide MFS with the platform for the creation of a significant New Zealand financial services provider,” Maywald said.
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Hosted by Simon HoyleDecember 9, 2024
