The Commonwealth Bank group (CBA) has bought outAvanteosand is slated to roll out the platform provider’s systems across its three dealer groups in a deal struck last week.
Avanteos chief executive Mark Papendieck says the deal results in the Commonwealth purchasing, for an undisclosed sum, the part of the company it did not already own throughColonial First State, which has held 45 per cent of the group since April 2001.
The deal is likely to lead to the roll out of Avanteos’ services to the Commonwealth’s three dealer groups — Commonwealth Financial Planning,Commonwealth Financial SolutionsandFinancial Wisdom.
Papendieck says for Avanteos to continue to grow, it needed the input of a large shareholder such as the CBA.
The Avanteos brand and management team will not change as a result of the buy out, but the board will be restructured with the CBA nominating six board members, two of them executive directors from Avanteos.
Papendieck says under this board structure, Avanteos management will continue to have responsibility for the operation of the business. He says there will be little change in the regular operations of the group for the time being.
CBA financial planning and advice services executive general manager Geoff Austin says the group will use Avanteos across its wealth management business and will run its wrap offering “as a natural complement to the simplicity of Colonial First State’s FirstChoice platform”.
“FirstChoice is a good product but it takes a different tack than the Avanteos platform and it was on that basis the CBA pursued full ownership of the group,” Austin says.
The purchase of Avanteos rounds out the financial services holdings for CBA, which now boasts banking, funds management, platform and portfolio services and planning businesses, with Austin saying the CBA group was looking to compete across all parts of the value chain.
Avanteos has already signed up a number of other dealer groups to its service, includingDeakin Financial Services,Beacon Investment Management Services,Lifespan,AustChoiceand Investment Diversity.
Papendieck says the group would continue to service these clients as well as actively seek new ones outside the CBA network. Austin says the CBA would encourage such growth as “it is philosophically not that different from what FirstChoice does.”
