National buys MLC for $4.5 billion
The National Australia Bank confirmed industry rumours by officially announcing it will purchase MLC from Lend Lease for $4.56 billion cash, with a completion date set for after mid-June.
The National Australia Bank confirmed industry rumours by officially announcing it will purchase MLC from Lend Lease for $4.56 billion cash, with a completion date set for after mid-June.
The deal will give the MLC and National funds management business a combined total funds under management of $52 billion with total retail funds under manage-ment of $26 billion.
National managing director and chief executive officer Frank Cicutto says the ac-quisition will be financed from internal resources and available debt facilities and no shares will be issued.
Cicutto says MLC's management team and culture will remain as these were inte-gral to the success of the group.
"MLC and the National's wealth management business will combine to become the wealth management specialist within the National group," Cicutto says.
"The combined business will be headed by Peter Scott, the current head of MLC and will be based out of Sydney."
The combined adviser numbers within the group should equal nearly 1200 with plans for an exchange of products and services between the two groups.
"Advisers, both within the National and MLC, and the independents, will benefit from a wider range of opportunities and products. Both businesses have strong brands and these will continued to be developed and promoted," Cicutto says.
"The National will offer MLC advisers the opportunity to market the its range of bank products should they wish to do so while National advisers will benefit from having access to MLC's delivery technology and platforms."
The sum is just over half of what the Commonwealth Bank will pay for Colonial First State when that purchase is concluded and adviser numbers should also be comparable.
Lend Lease will retain its real estate funds management business and it property securities investment arm, but still has to gain approval for the sale from share-holders at a general meeting to be held in June.
If the shareholders approve the sale they will receive $1.5 billion of the proceeds through a number of capital management initiatives, with the balance used to fund investments in Lend Lease's core real estate operations.
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