AXA rewards ipac
Ipac Securities will receive around $9 million in scrip from its AXA Asia Pacific parent after passing its first target in terms of inflows as part of the agreement struck between the parties when AXA bought ipac in July 2002.
AXA will issue up to 2,299,364 shares as deferred consideration for the adviser group, adding to the initial cash payment of $205 million that it paid the original ipac vendors in 2002.
Neither AXA or ipac would confirm the ongoing targets or the level of shares that would be issued if the next, annually assessed, target is reached.
According to the Money Management Top 100 Dealer Group Survey’s for 2003 and 2004, ipac’s funds under advice grew from $1.06 billion to $1.21 billion for the twelve month period ending December 2003, with revenue growing from $15.3 million to $16.4 million over the period.
As part of the acquisition deal, AXA agreed to issue up to 22.6 million shares as deferred payment for meeting these fund flow targets. No payment was made in 2003.
The payment of shares will occur in two batches, with 1,322,595 shares to be issued to the original vendors today, and up to 976,769 shares set to be distributed for the benefit of ipac staff eligible under GRP and is expected to occur before September 30.
In order to neutralize the dilution impact of issuing such a number of shares, AXA bought back around 22.6 million at the time of the initial deal.
AXA says the achievement of the hurdles indicates ipac has delivered value over and above the initial cash payment.
“Being hurdles they aren’t something that are set low, they are targets,” an AXA manager investor relations Ronn Bechler says.
Recommended for you
Licensee Centrepoint Alliance has completed the acquisition of Brighter Super’s annual review service advice book, via Financial Advice Matters.
ASIC has launched court proceedings against the responsible entity of three managed investment schemes with around 600 retail investors.
There is a gap in the market for Australian advisers to help individuals with succession planning as the country has been noted by Capital Group for being overly “hands off” around inheritances.
ASIC has cancelled the AFSL of an advice firm associated with Shield and First Guardian collapses, and permanently banned its responsible manager.
