Wealth management infrastructure solutions provider IWL has shown the first signs it will sell off its financial services software arm, Visiplan, to IRESS Market Technology (IRESS), with the group stating it plans to finalise the transaction this April.
In a statement released to the Australian Stock Exchange, IWL advised that both companies have “now largely completed commercial negotiations”, with the process now at the final due diligence and legal drafting stage.
Further confirming Visiplan is likely to be sold, IWL chief operating and financial officer Luke Littlefield said: “The intensions of both groups is to execute a transaction. The transaction would be the divestment of IWL’s advisory software business to IRESS.”
Interestingly, Littlefield said before IRESS approached IWL with a proposal to acquire Visiplan, IWL had no intension to shop the business around.
“The business wasn’t for sale. However, when the board is approached by another organisation, and it’s a bona fide approach, the board has an obligation to determine the merits of that approach,” he said.
“They did that, and I guess whether or not that concludes will be confirmed when a share sale agreement is signed. When you receive an approach and the board asks the company to investigate the bona fide of the approach — that happens through due diligence and negotiation — and if it’s successful it comes out with a transition. We weren’t shopping the business. The business wasn’t for sale, however these things have always got to be considered.”
Littlefield also confirmed that if the transaction concludes, IWL would cease to operate as a financial planning software provider. “It doesn’t mean it won’t provide wealth management solutions in other areas through our broking and portfolio solutions to the advisory market and wealth management market in Australia,” Littlefield added.
In February this year, IRESS renewed its pursuit of financial adviser software business Visiplan after putting forward an acquisition proposal to IWL.
In 2002, IRESS and IWL announced they had finalised a merger bid, but weeks after going public on the deal both companies agreed to discontinue the arrangement. In 2003, IRESS finalised the purchase of Xplan Technology.
