Plan B sale stalls

PLANS by UK banking group HBOS to move to 100 per cent ownership of BankWest have overshadowed another ‘takeover’ battle involving the bank.

At last week’s annual meeting, BankWest said plans to sell its 50 per cent shareholding in Plan B Financial Services, WA’s largest independent financial advisory group, had unravelled.

“The agreement was subject to the founding shareholders being able to obtain finance and we have now been advised that they have been unable to satisfy this condition,” BankWest managing director Terry Budge told shareholders.

Plan B chief executive Bryan Taylor tells a somewhat different story.

He said the sticking point was price, not funding.

Mr Taylor said that he and fellow founding shareholder Craig Lubich still expected to regain full ownership of the business.

“It’s highly unlikely that anyone will buy those shares unless they are a friend of mine,” Mr Taylor said.

“The most likely buyers still remain the founding shareholders.”

Mr Taylor said BankWest, which is advised by Gresham Partners, wanted to sell its shares for “far more” than their $8 million book value.

By contrast, Mr Taylor said he and Mr Lubich “perhaps with some friends” were looking to buy back the shares for less than $8 million.

If they were successful, this would trigger another balance sheet writedown.

In its December 2002 accounts, the bank wrote down the value of its Plan B stake from $11.6 million to $8 million.

Mr Taylor said the downturn in investment markets had adversely affected the value of all funds management and financial advisory groups.

This included Plan B, which has 125 staff and more than $1.1 billion of funds under management or advice.

While Plan B’s ownership remained unclear, there was more certainty regarding BankWest’s ownership, at least in the short term.

Its independent directors have welcomed 57 per cent shareholder HBOS’s proposal to buy out the minority shareholders.

“I believe this has the potential to be a positive outcome for BankWest and Western Australia, and the beginning of a new era for the bank, with greater support and involvement by a major international bank, now the fourth biggest in Europe,” chairman Ian Mackenzie said.

HBOS has sought to dampen speculation that the move to full ownership was a precursor to a trade sale.

A HBOS spokesman said its intention was to build BankWest. Details would be provided when documentation for the scheme of arrangement was released in coming weeks.

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