On 30 April 2009, the merger between IOOF Holdings Limited (IOOF) and Australian Wealth Management Limited (AWM) became effective.
The merger between IOOF Holdings and Australian Wealth Management creates:
- A leading financial services company
- Over $87 billion under management, administration, advice and supervision
- Operations spaning the entire wealth management value chain
About IOOF Holdings
IOOF is very similar to AWM, in that it offers a range of investment and superannuation products for investors and employers.
They operate a number of businesses including:
- IOOF Portfolio Solutions – Superannuation administration
- IOOF Investor Solutions – Investment products
- Perennial – Asset management
- Consultum – Dealer group
Together, we will use our combined resources more efficiently to provide wealth management products and services to more Australians.
Visit the IOOF website, http://www.ioof.com.au/
Shareholding details
Under the terms of the proposed merger, each AWM shareholder received 1 IOOF share for every 3.73 AWM shares owned.
All AWM shares have now been converted to a holding in IOOF using the formula above, and shares in AWM cancelled.
Link Market Services, IOOF's share registry sent all shareholders a notice of their new holding in Mid May.
Frequently Asked Questions
Why have Australian Wealth Management (AWM) and IOOF Holdings decided to merge?
The two companies have decided to merge to establish a significantly stronger business. The rationale for combining these two organisations is compelling. It will deliver substantial enhanced earnings per share accretion for both AWM and IOOF shareholders. Moving forward, we expect the experience of AWM and IOOF customers will also be enhanced.
The merger will create a leading financial services company with more than $88 billion funds under management and administration, spanning the entire wealth management value chain, with an enhanced distribution network of over 580 aligned financial advisers nationwide.
There is significant value in bringing the two companies together as they are similar in so many ways, with the merger expected to generate post tax cost synergies of $20 million per annum in the first 12 months.
Why merge at this time?
The merger represents a unique opportunity to combine two highly complementary businesses. In a difficult operating environment for wealth managers, we expect that the transaction will realise immediate value for both sets of shareholders and put the merged group in a very strong market position
The recent downturn has illustrated the importance of size and scale in terms of competitive position. The new company, through the synergies, will be much stronger and better placed to compete in the current marketplace. The size of the synergies relative to the expected market capitalisation of the combined company also becomes greater.
Going forward, it is expected that the combined entity will be well positioned to take advantage of any improvement in the markets.
What is the tax treatment for my shares?
The company has received an ATO Class Ruling in respect to the Capital Gains Tax consequences of the disposal of AWM shares, which occurred as a result of the Scheme of Arrangement with IOOF.
This will assist shareholders in determining the appropriate market value of the IOOF shares received as a result of the scheme of arrangement.
The ruling is available here
How will things change for stakeholders?
The merged company will be significantly stronger with better scale in its operations, wider sales and distribution reach, a broader product range, lower overheads, improved service to advisors and ultimately, a stronger balance sheet.
How will the merger affect AWM’s and IOOF’s businesses?
There will be no change to the product or service offerings, and the combined business will continue to develop the extensive range of products to be relevant to broader market segments.
Who can I speak to about the merger?
Please contact Melinda Hofman, Corporate Affairs Manager at Australian Wealth Management Limited on (02) 9028 1054 or email investorrelations@awmlimited.com.au