INVESTSMART GROUP LIMITED — Capital/Financing Update 2018

Jun 11, 2018

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12 June 2018

Attention: Company Announcements ASX Limited

Option to Acquire the Term Deposit Shop

InvestSMART (INV), a leading independent investment adviser helping Australians to grow and protect their wealth, has acquired an option to purchase all the shares in The Term Deposit Shop Pty Ltd and related entities.

With a broad range of innovative investment services, portfolio management tools and reporting and research that attracted over 7 million website visits this financial year, the option to acquire The Term Deposit Shop offers InvestSMART clients the prospect of easier access to term deposit products and simple switching between them.

The Term Deposit Shop

The Term Deposit Shop is an online cash management platform that makes it easy for depositors to maximise term deposit returns with minimum effort. It has been operating since 2012 and has had a fully digital service since October 2017.

The Term Deposit Shop deals with some of the largest 30 registered Australian Deposit-taking Institutions (ADIs). The ability for InvestSMART to promote a term deposit platform directly to its 600,000 members offers an opportunity to share in this $4.6 trillion term deposit and cash market, also potentially increasing its funds under advice.

Terms of the Option

Non - refundable deposit

InvestSMART will pay a non-refundable deposit of $250,000 to TTDS, which will be used as working capital to grow the business.

Exercise Price

InvestSMART will pay the shareholders of TTDS $1.75 million in cash and $2 million in InvestSMART shares, the number of shares being determined by the weighted average price of InvestSMART shares in the three-month trading period prior to the completion of purchase.

Exercise Date

InvestSMART can exercise its option after the third anniversary and before the fourth anniversary of the option grant date, 12 June 2018.

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Revenue share

InvestSMART will be entitled to 50% of any revenue received on clients introduced by InvestSMART to TTDS during the option exercise period. This revenue share will continue if the Option is not exercised.

Benefits to InvestSMART

As noted in the AGM presentation and reported to the ASX on 22 November 2017, InvestSMART members have over $2.1 billion in cash and term deposit assets recorded on our portfolio manager. The Term Deposit Shop platform offers those members seeking better returns on their term deposits and cash accounts, a simple and attractive way of making the switch.

Term deposits are a commoditised product with the Australian Government providing a guarantee to all deposit holders on the first $250,000 held with registered ADIs. Providing members with a simple platform to compare term deposits and invest in them will, in many cases, be the first transaction a member will make with InvestSMART. This will build trust in our services and brand, potentially leading them to engagement with other InvestSMART services.

For further information or comment, please contact Paul Clitheroe, Chairman, or Ron Hodge, Managing Director and CEO, at InvestSMART Group on 02 8305 6000

About InvestSMART

With more than 600,000 members, InvestSMART Group Ltd, a listed financial services company, is Australia’s leading online resource for stocks and investment research, portfolio strategy advice and self-managed superannuation coverage. It owns Intelligent Investor, Eureka Report and has launched a number of its own funds.

InvestSMART was founded in 1999 and the Chairman is Paul Clitheroe AM. Paul has 37 years of experience and is regarded as one of Australia’s leading “money” experts. Paul hosted the popular Channel 9 program Money and now chairs the Australian Government Financial Literacy Board and holds the Chair of Financial Literacy at Macquarie University.

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