St George Bank has made moves to purchase the remaining 92 per cent stake of Wealthpoint, which would reunite the businesses of Sealcorp and Assirt under the St George banner.
The two businesses were seperated last year when Assirt was spun off and joined with Bourse Data to form Wealthpoint.
Under the terms of the deal St George has offered 60 cents a share for the remaining 52 million shares, worth $31.2 million with the proposed acquisition to be completed by a scheme of arrangement and subject to WealthPoint shareholder and court approvals.
When St George sold off Assirt it continued to hold a stake in Wealthpoint group stating it would look at increasing that in the future.
The deal will see WealthPoint brought within the St George group as a wholly-owned subsidiary with its own management structure and board. WealthPoint’s independent directors unanimously recommend the proposal to ordinary shareholders.
According to St George the directors have told the oridnary shareholders that in the absence of any higher offers the acquisition is the best alternative available.
In a statement released to the Australian Stock Exchange (ASX) WealthPoint managing director Brett Sanders says being part of the St George Group would allow WealthPoint to focus better on its core business of providing personal wealth management services and tools.
“I believe the price offered to WealthPoint shareholders provides sound value and recognises their efforts and support in developing the business. This offer is significantly above the recent trading price reflecting the unique importance of the investment to the St George Group,” Sander says.
St George said it believes the 60 cent offer price to WealthPoint shareholders was fair given the funding challenges that would confront the company if it were to remain independent. It said it would review the valuation of its investment in WealthPoint in on September 30.
When concluded the deal will bring full circle the relationship between Sealcorp and Assirt. Assirt was originally launched by Sealcorp and both were purchased by St George in 1997 and held until they were seperated last year. At that time St George also spun off Quicktrade and Assirt to Bourse Data, which changed its name to Wealthpoint.
The purchase also concludes any loose ends over St George’s ownership of Wealthpoint. According to a St George spokesman the group currently owns about eight per cent of the ordinary shares and also holds convertible preference shares. If these were exercised when due, in about 12 months, St George would have owned about 67 per cent of Wealthpoint.
