Ipac Australia – which became a part of AMP, one of Australia’s largest asset managers, last year following an A$14bn acquisition/divestiture deal agreed with Axa in 2010 – will continue to operate in that market, while an Ipac operation in Taiwan will also continue to operate locally, Axa said in a statement.
At year end, it had been thought that Axa Group, the giant, Paris-based insurance company, was in the final stages of agreeing a deal to sell the Hong Kong and Singapore Ipac operations to an undisclosed Australian company.
As reported, sources told International Adviser that it had even obtained permission from Hong Kong’s regulator to go ahead with the deal, and that all that was needed was the approval of Singapore’s regulator.
In a statement on Monday issued by its Singapore office, Axa said it had “concluded that the divestiture of these fee-based financial planning businesses would be consistent with its ambition to focus on continuing the strong growth of its insurance businesses in Asia”.
It added: “Having reviewed several options, Axa has decided that it will close the ipac Asia businesses in the first half of 2012. All clients will be contacted shortly to discuss their portfolios and options open to them as a result of this action.”
Axa said the closure of the two Ipac offices would have no material impact on Axa Asia’s revenues or profits.
Integrity
Axa did not say what, if any, plans it has for another advisory business it has in the Hong Kong market, known as Integrity Financial AdviceNetwork Co., which it established there in 2010.
According to its website and interviews with other advisers in the market, Integrity is primarily a platform business aimed at financial services professionals who cater mainly for local, rather than expatriate, clients.
Australian origins
The Ipac advisory business began in Australia in 1983, where one of its founders had been Paul Clitheroe, who went on to become a relatively well known TV investment show presenter. The company was acquired by Axa in 2002 for A$250m ($250m), and, with Axa’s resources behind it, immediately began to expand into Asia.
However, according to those familiar with Ipac, which specialises in providing high-end, fee-based advice to wealthy expatriates as well as to a growing number of local residents in all its jurisdictions, the firm never actually produced a profit for Axa. (Axa has declined to comment on such reports.)
It is not known how many employees will be affected by the Ipac office closures. In a profile of the company which appeared in International Adviser last September, the company said it had a total of 92 employees, of which 32 were advisers, but it is not known how many of these were in the Taiwan office, which as mentioned is continuing as a stand-alone operation.
The article noted that Ipac at that time had around 2,000 clients, and around $800m in funds under management.
In the statement announcing Axa’s plans to close Ipac, John Dacey, vice chairman for Asia Pacific, thanked the “Ipac Asia teams” for their “contribution to the region over the years, and especially their strong commitment to serving their clients".
News of Axa’s intentions to shed the remainder of Ipac that it owns followed UK press reports, in November, that it is also looking to sell most of its London-based Bluefin advisory business. Until August, one of Ipac’s founders, Suvan de Soysa, had been Bluefin’s managing director.
