SYDNEY, AUSTRALIA: WT Financial Group Limited (ASX: WTL) has entered a Sale and Purchase Agreement to acquire 100% of the issued capital of Australia’s largest privately-owned financial adviser group, Synchronised Business Services (Synchron).
The total vendor consideration for the acquisition is up to $7.96 million, payable over two-years in a combination of cash and shares, and subject to various terms and conditions.
WTL will assume liabilities of circa $3 million and expects to incur transaction and integration costs of between $1-2 million bringing the anticipated total value of the acquisition to $12-13 million.
The acquisition is highly synergistic and accretive to earnings. On settlement of the acquisition, which is scheduled to occur this week, the company’s B2B operations will encompass Wealth Today; Sentry Group; and Synchron – making WTL the largest independent advice network in Australia.
Commenting on the Acquisition WTL CEO, Keith Cullen, said: “The acquisition cements WTL as the largest independent – or non-institutionally-owned, non-product producing financial adviser network in Australia and establishes the right scale of operations to enable us to provide the critical supports advisers in our modernised industry demand.
It is a highly synergistic acquisition and is significantly accretive to earnings – the resulting scale will set the course for future expansion and more depth in our offerings for advisers.
“WTL will benefit from Synchron’s line of talented state managers who will add significant value to the overall group structure. We’re delighted too that Synchron founders Don Trapnell and John Prossor will continue to work within the business, helping support the integration with WTL’s existing operational structure, and retention and growth of the existing adviser base”.
Demand for advice continues to grow across Australia with millennial inheritance from 2020-2040 forecast to reach $3,500bn, with superannuation assets expected to double by 2029, and the largest cohort ever to enter age care.
The landscape within the financial advice sector has a strong outlook, and the synergies created from the acquisition position us for further growth.
“Thanks to the Acquisition structure, the Synchron founders will maintain investment exposure to Synchron by holding shares in WTL as we continue to advance as a leader in the Australian financial advice sector.”
Commenting on the Acquisition Synchron Founder Don Trapnell, said: “Selling Synchron into WTL represents the next stage of growth for our company. With WTL’s focus on outcomes for its advisers, and its strong strategic direction, the Synchron business will benefit from integration into the WTL business – with advisers from each of the cohorts benefiting from a broader base of personnel and programs to help support and grow their businesses.
Both myself and John Prossor are excited at becoming shareholders of WTL and we both look forward to contributing to the expanded group operations and to creating further value for all WTL shareholders”.