Australia's IOOF considers buying ANZ's wealth business

Added 30th November 2016

Australian-listed financial services firm IOOF Holdings has indicated it is interested in buying the ANZ bank’s domestic wealth management business.

Australia's IOOF considers buying ANZ's wealth business

The ANZ Bank said earlier this month that it was considering selling its life insurance, advice, and superannuation and investments businesses in Australia, hoping to raise more than $4.5bn (£2.7bn, $3.4bn) from the deal.

The announcement follows a deal between ANZ and Singapore’s DBS Bank to sell its retail and wealth businesses in Singapore, Hong Kong, China, Taiwan, and Indonesia.

In an interview with The Australian newspaper published on Wednesday, IOOF chief executive Chris Kelaher said of the ANZ's plan to sell its wealth business: “The way it is presented, we would be a prime buyer if it plays out the way it has been stated.”

“We have a number of different opportunities we are looking at. Prima facie, it presents very attractively. We are the most successful purchaser in this space. Theoretically it is on all fours with what we do.”

However, Kelaher also told the newspaper his company was not yet in talks with ANZ about buying the wealth management business, adding “it’s early days”.

Industry acquirer

IOOF is one of the biggest independent wealth advisers in Australia following a series of acquisitions in recent years, and has A$31bn in funds under supervision, A$107bn in funds under management, ­administration and advice and a network of about 1,000 financial advisers.

ANZ chief executive Shayne Elliott has said the bank would consider an offer for the whole business or could look at selling off its different components, which include a life insurance arm, a superannuation business, a funds management business and a network of some 1,500 advisers, including bank staff and people working for dealer groups.

This follows a move by National Australia Bank last year to sell 80% of its life insurance arm to Nippon Life of Japan for $2.4bn.

Kelaher said the IOOF was in the market for more acquisitions as it expected the wealth management market in Australia would continue to grow, particularly for independent operators.

“The opportunity set for us at the moment has never been greater,” he said. “We have been very successful in acquisitions. It has been part of our strategy. It is something we are good at. You play to your strengths.”

In 2009 the IOOF merged with Australian Wealth Management and Skandia. In 2011 it bought the DKN Financial Group and Lonsdale. It bought the Plan B Group and Avenue in 2012, before agreeing to buy the Shadforth Financial Group in 2014.

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Richard Hubbard

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Richard Hubbard is the group editor at Last Word. He is responsible for the editorial content of International Adviser, Portfolio Adviser, Expert Investor and Fund Selector Asia. Richard previously worked for Thomson Reuters and has covered the financial services industry and investment themes from its offices in London, Singapore, Hong Kong and New York. Richard started his career at the Australian Financial Review in Sydney.


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