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A bid has been made for the Australian Financial Services group (AFS), but at this stage the identity of the bidder remains a well-kept secret.
On revealing the initial bid, AFS’s Barry Stephen said the potential buyer of the dealer group, which has the tag line ‘Adviser owned, adviser driven’, was a non-institutional buyer.
But not everyone has the same definition of ‘institution’. AFS chief executive Peter Daly said the bidder was not a major corporate entity, a major accounting firm, a bank or a major fund manager.
He did, however, point to the ‘vertical integration’ this group is interested in developing in partnership with AFS, suggesting the potential buyer has at least a hand in product manufacturing.
“If it is successful they will be utilising AFS as a foundation for future growth and development,” Daly said, also pointing to the mystery buyer’s ambitions to expand into Asian markets.
“It is a very exciting development that they are talking about,” Daly said.
“And AFS will actually be only one component of what they want to develop.”
Daly described the company and the concept as “something completely new and different”.
But while the ‘adviser owned’ tag would have to go if the deal was successful, Daly argues the group would remain adviser driven.
He said the potential new owner wants to see AFS retain “its current format, with its current culture”, adding the bidder “respects and sees the benefit of the open architecture we have”.
“The intent as I understand it at this particular point in time is to keep the brand, the management, virtually everything the same.”
While Daly is clearly drawn to the offer, he makes it clear there’s still a way to go in this particular deal. Daly said while a written offer had been received, “the detail of the offer remains to be confirmed” and the group’s shares have not been suspended. AFS has around 70 shareholders, most of whom are practice owners.
The deal would require 90 per cent stakeholder approval. Daly said the shareholder response to date had been mixed, with practice owners, along with the AFS board, waiting to see the details. At a principals’ meeting last weekend, practice owners were assured the group remains focused on an eventual listing — with Daly describing the offer as a potentially “interesting deviation” en route.
