Financial Synergy is set to become Tasmania’s largest independent provider of corporate employee benefit services following its takeover of NSP Buck’s Tasmanian operations.
The terms of the deal allow for a two year transition period during which NSP Buck will share a percentage of revenue from the Tasmanian business. The takeover will boost Financial Synergy’s Tasmanian funds under administration by about $150 million.
Financial Synergy Tasmania director Michael Irwin says the merger will deliver true scale to its Tasmanian operations.
“This means we are starting to get to a size where we are a robust operation,” he says. “It gives us a greatly expanded capacity to provide services in the corporate superannuation arena and will at the same time strengthen the knowledge and capabilities of our staff.”
Irwin says the acquisition will also force Financial Synergy to set up a financial planning operation in Tasmania, which he expects to grow according to demand.
Deputy chief executive of NSP Buck, Christopher Butler says the decision to pass NSP Buck’s Tasmanian business to Financial Synergy was based on the company’s concerns about providing quality service to Tasmanian clients.
“For some time we have been concerned about our ability to provide a complete service on the ground to our clients in Tasmania, particularly in light of the significant changes taking place in the financial services industry,” he says.
“Financial Synergy’s expanding business will provide clients with a greater service range.”
NSP Buck is Australia’s second largest provider of superannuation administration services, with $12 billion under administration, offices in all states and about 40 financial planners. Before the buyout, the group’s Tasmanian office held $150 million under administration and employed three staff.
Financial Synergy is a much smaller player in the same field and is better known as the developer of administration software, which is currently used by a number of organisations to administer over 1.6 million superannuation and investment accounts. Nationally, Financial Synergy’s funds under administration more than doubled to $129 million during 2000/2001 and are expected to double again over the next 12 months.
Financial Synergy in Tasmania, which is 50 per cent owned by its directors, will now employ 14 staff and administer over 250 self-managed and corporate funds.
