16/05/2014 - 13:42

Wealth managers strike $670m tie-up deal

16/05/2014 - 13:42

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Perth financial planners and former Test cricketers John "Sam" Gannon and Craig Serjeant are set to be two of the big winners from a $670 million takeover deal that will create Australia's third largest wealth manager.

SFG Australia deputy chairman John "Sam" Gannon (left) and former Shadforth Financial Group state manager Simon Joyner.

Perth financial planners and former Test cricketers John "Sam" Gannon and Craig Serjeant are set to be two of the big winners from a $670 million takeover deal that will create Australia's third largest wealth manager.

Financial adviser IOOF Holdings is set to take all shares in smaller rival SFG Australia in an all-scrip takeover announced to the market today.

SFG Australia was created in 2011 through a merger between Shadforth Financial Group and listed advisory firm Snowball Group.

IOOF has offered its own shares to SFG Australia shareholders in a deal that implies a value of 90 cents for every SFG Australia share, based on the last closing price of IOOF shares.

SFG Australia shares last traded on the market for 73 cents.

Mr Gannon, who is deputy chairman of SFG Australia, holds a 4.6 per cent stake in the company.

His stake would be valued at $30.5 million under the takeover.

The deal would also pay dividends for Mr Serjeant, who sits on the board of Shadforth Financial Group.

Mr Serjeant's 2.1 per cent stake in SFG Australia would be valued at $13.9 million under the takeover.

The pair each made their Test cricket debut for Australia in 1977 after earlier playing for Western Australia.

Mr Serjeant, a middle-order batsman, played 12 Tests in 80 first-class matches while Mr Gannon, a left-arm fast bowler, played three Tests in 40 first-class matches.

Following his retirement from cricket in 1979, Mr Gannon went on to become chief executive of Perth financial planning firm Gannon Growden Schonnell.

Gannon Growden Schonell became part of Shadforth Financial Group in 2009.

IOOF also has Western Australian connections, having acquired Perth company Plan B Financial Services last year in a $49 million takeover.

The company's managing director, Christopher Kelaher, said it would be business as usual for SFG Australia's clients once the deal is completed.

If court and shareholder approval is granted, the takeover is expected to be sealed by late August.

IOOF has almost $124 billion in funds under management and supervision, and offers financial and investment advice and trustee services.

SFG Australia provides a range of wealth management services, and has $13.7 billion in funds under advice.

The company's shares closed the day's trade almost 19 per cent higher at 86.7 cents.

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