Challenger snaps up Deutsche Life
Challenger’s meteoric rise in the financial services industry shows no sign of abating with the $45.6 million purchase of Deutsche Life.
Challenger’s meteoric rise in the financial services industry shows no sign of abating with the $45.6 million purchase of Deutsche Life.
Under the terms of the deal, Challenger will pick up Deutsche Life’s $290 million fixed term annuity book of business. Challenger has been one of the most agile players in the rapidly consolidating financiasl services industry. In the past two years, the group has picked up the financial planning group Garrisons, the Synergy master trust, the Village Entertainment property trust, Citibank’s margin lending business and Norwich’s mortgage trust business among others. With the acquisi-tion of Deutsche Life, Challenger now has more than $4.5 billion under manage-ment on behalf of 85,000 clients; not bad for a group which two years ago was es-sentially a manufacturer and distributor of structured equities products.
On the other side of the balance sheet, Kerrry Packer’s Consolidated Press Hold-ings paid just over $40 million for a one eighth holding in the company just over a year ago. About a quarter of the Deutsche Life purchase will be financed through share placements with Consolidated Press Holdings and Challenger managing di-rector Bill Ireland’s Universal Equity group.
Deutsche Life will be merged with the annuities subsidiary Challenger Life, bringing total statutory funds to more than $500 million.
Ireland says the Deutsche deal represents a “perfect fit” for Challenger Life with boosts to distribution, products and internal cost savings.
Deutsche Life distributes its products through a network of more than 40 financial planning groups, predominantly located in New South Wales and Queensland. Challenger, on the other hand, has strong presence in Victoria and Tasmania through its wholely owned subsidiary Garrisons.
Ireland also says the deal will also strengthen Challenger’s relationship with Deut-sche Financial Planning’s 70 advisers.
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