Snowball gains momentum
National financial services business Snowball Group has acquired equity stakes in three more New South Wales-based financial planning practices, adds to its funds under advice by about $200 million bringing total FUA to more than $4.2 billion.
The acquisition, to be funded by cash and Snowball shares, entitles Snowball to a fixed proportion of the three Sydney-based practices’ revenue streams for a 50-year term. The planning practices, which Snowball said specialise in complementary areas to its existing New South Wales-based enterprises, will operate under the licence of Snowball subsidiary Western Pacific.
According to Snowball, the three practices together with another recent acquisition, Sydney-based financial planning firm IFP, will add between $0.8 and $1 million to the business’ annual profit (EBITDA).
Snowball managing director Tony McDonald said the acquisitions are part of a long-term growth strategy.
“IFP represented a tuck-in to our Outlook Financial Solutions [another Snowball subsidiary] channel. This most recent acquisition is structured under the franchise model we developed with Western Pacific.
“In our view, there is no effective one-size-fits-all template when it comes to helping planners manage their future growth and, ultimately, their own succession. Snowball’s proven M and A [mergers and acquisitions] approach recognises the needs of different styles of practice at different stages of their development, and is now producing significant benefits for those planning groups that have joined the Snowball family under either arrangement.”
Snowball maintains that it is on target to achieve organic growth in EBITDA of 15 per cent for the 2008 financial year.
“As we indicated at the annual general meeting [in November last year], this guidance excludes any uplift from acquisitions. The uplift from [recent acquisitions] is in addition to the stated 15 per cent organic growth.”
Recommended for you
A former Sydney investment manager has pleaded guilty to two counts of insider trading regarding a potential takeover of Platinum Asset Management, having acquired $2.6 million of Platinum shares.
As the firm enters a new growth phase, Orbis Investments managing director Jason Ciccolallo has said it is looking to strengthen relationships with retail advisers to align with the firm’s institutional reputation.
The former director of United Global Capital has received a decision from the Administrative Review Tribunal regarding an appeal of his 10-year ban from providing financial services.
AMP-owned North has announced a senior manager appointment as the platform explores growth opportunities in its addressable adviser market.
