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Investment management firm Forsyth Barr is bolstering its $30 billion wealth advisory business, buying boutique firm Hobson Wealth Partners off its staff and Australia’s Macquarie Group for an undisclosed price.
The merged group will see Forsyth’s financial adviser network swell to 220 nationwide and its client volume book grow by“several thousands”, managing director Neil Paviour-Smith told the Herald.
It currently manages $30b worth of client assets.
He planned to use the bolstered network to win more wealth clients, or more of existing clients’ funds, currently tied up in bank accounts or term deposits.
“The reality is there is a huge amount of investable wealth in New Zealand,” Paviour-Smith said.
Hobson approached Forsyth about a potential acquisition in the middle of this year and spoke to a number of parties, he said.
The Auckland-based firm is majority owned by staff, about 32 per cent owned by its chief executive Warren Couillault, and 8.9 per cent owned by former owner Macquarie.
The firm pools client money into managed funds and is also involved in KiwiSaver through its Koura offering.
Warren Couillault owns about 32 per cent of Hobson Wealth Partners according to Companies Office records. Photo / Greg Bowker
Couillault said Forsyth “ticked all the boxes”, in a written press release announcing the deal.
“We have been considering the strategic growth alternatives for Hobson Wealth over the past couple of years, looking for ways we can enhance services for our clients and help scale the business.
“[Forsyth’s] market-leading offering in areas like research will provide Hobson Wealth clients with great outcomes, as well as providing Hobson Wealth advisers with opportunities for growth, importantly within a New Zealand and staff-owned business.”
Paviour-Smith said the acquisition was made with a mix of cash and shares, which would see Hobson partners swap their equity in the firm for Forsyth Barr shareholdings.
Hobson clients would start to receive Forsyth Barr investment research from next week, and research from Macquarie would soon end, however, all services, contacts and fees would remain the same for the meantime.
Job losses could be on the cards with some functions at the two firms overlapping.
“At some stage we will develop our plan to integrate into Forsyth Barr - a consequence of that will probably be some duplication of roles that we will need to work through, but we haven’t made any decisions or formed a hard view on those things.”
Paviour-Smith stressed both firm’s focus on client relationships.
“That’s critical to us.”
The transaction would take effect on December 11 and the brands would begin to merge in the second quarter of 2024.
Paviour-Smith did not expect any regulatory hurdles.
The deal is the latest consolidation in the financial services space, following Fisher Funds’ acquisition of Kiwi Wealth.
Madison Reidy is the host of New Zealand’s only financial markets show Markets with Madison. She joined the Herald in 2022 after working in investment, and has covered business and economics for television and radio broadcasters.
