Sequoia has completed the sale of 80 per cent of Morrison Securities to Sydney technology company, New Quantum Holdings.
New Quantum concluded the last tranche of the $40.5 million acquisition on 31 August, a statement from the firm said.
The deal was first announced in early March. Sequoia retains a 20 per cent share in the business.
In Australia, the technology company will now seek to build on the infrastructure in the equities clearing, brokerage and settlement business, to become the “definitive platform for fintech and financial services firms”.
This will focus on automating workflow for wealth management and superannuation funds.
Globally, it will look to develop strategic partnerships in the Middle East, Asia and the US with a focus on government pension funds.
New Quantum group chief executive, Shantanu Jha, said: “New Quantum’s acquisition of Morrison Securities is the cornerstone of a series of transactions laying the foundation for both its domestic and global growth.
“New Quantum’s mission to automate and abstract away the complexities of regulation, administration and capital allocation is uniquely geared to creating a revolution in the financial services world.
“We believe New Quantum’s operating system for financial services firms, combined with the venerable financial infrastructure of the newly acquired Morrison, exemplifies the power of vertically integrated business models that can internalise the value created by the underlying technological automation.”
Jha is newly appointed to the role of group CEO and was previously chief investment officer at the firm’s equity sponsor, Beaconsfield Capital Management.
Sequoia acquired Morrison Securities in September 2017, offering third-party stockbroking execution solutions to AFSL holders such as financial planners, financial advisers, banks, building societies and trading educators.
In its most recent FY results for the year to 30 June, Sequoia said revenue fell to $131.5 million, a 10.7 per cent loss from $147.3 million in FY22.
Results were affected by weaker equity market conditions, non-recurring expenses, notably claims and penalties of $2 million, and unrealised losses on its share portfolio of $0.7 million.
Chief executive, Garry Crole, said the sale of Morrison Securities is expected to provide liquid capital for future mergers, where it will focus on general insurance broking, financial planner customer books and self-managed super fund (SMSF) administration roll-ups.
