Babcock denies planning push
Babcock & Brown has denied that a desire to make a major play into Australia’s financial planning distribution channels was behind its decision last week to significantly increase its stake in the dealer group owner and fund manager, FSP.
“Distribution is not something we focus on particularly, so the move was not really to create our own distribution channel,” said corporate communications manager Kelly Hibbins, who confirmed the listed investment bank had increased its holding in FSP from 20 per cent to 42.7 per cent.
FSP owns 50 per cent of the Financial Services Partners and Vector Financial Services dealer groups.
“[Expanding Babcock & Brown’s stake] was more for investment purposes. We wanted to increase our stake in a business that we think has a lot of potential,” she said.
Hibbins said Babcock & Brown had no intention of increasing its holding to be a majority stakeholder in FSP in the immediate future, saying they were “comfortable where we are”.
As part of the new ownership arrangement, trans-Tasman insurer Tower, which up until last week was the majority shareholder of FSP with a 60 per cent holding, will still hold onto 9.8 per cent of the group, while FSP directors and management will hold the remaining 47.5 per cent.
Financial Services Partners chief executive Geoff Rimmer said the Babcock buy-in was part of a wider strategy to provide more balanced ownership of both FSP and its dealer groups.
“The next phase will be to bring the dealer group shareholding up into one line, so Babcock, FSP and dealer group advisers all hold a relatively equal stake.”
FSP chair Dr Frank Wolf confirmed that Financial Services Partners and Vector advisers would be encouraged to take ownership of the dealer groups.
“The percentage ownership of the dealer groups between Babcock, FSP management and FSP related advisers will actually be worked out numerically on [the basis of] everyone’s relativity in the business to date,” he said.
Wolf said Babcock’s increased interest in FSP would give its financial planners greater capacity to offer Babcock products.
Recommended for you
AZ NGA has partnered with an Adelaide-based accounting and financial planning practice as it expands its presence in South Australia.
The central bank has released its decision on the official cash rate following its November monetary policy meeting.
ASIC has cancelled the AFSL of a Melbourne-based managed investment scheme operator over a failure to pay industry levies and meet its statutory audit and financial reporting lodgement obligations.
Melbourne advice firm Hewison Private Wealth has marked four decades of service after making its start in 1985 as a “truly independent advice business” in a largely product-led market.
