PRAEMIUM LIMITED — M&A Activity 2016

Sep 7, 2016

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Praemium acquires UK pension provider

8 September 2016, London : Praemium is pleased to announce that it has entered into an agreement to acquire Wensley Mackay Limited (Wensley Mackay), a pension provider in the United Kingdom.

Consideration for the transaction is £600,000 in cash and is subject to satisfactory completion of the conditions specified in the agreement, including approval by the Financial Conduct Authority (FCA), the UK regulator. Once completed, the transaction is expected to be earnings accretive in the first year.

About Wensley Mackay

Founded in 1992 and based in Cumbria, England, Wensley Mackay is a privately owned SelfInvested Personal Pension (SIPP) provider authorised by the FCA. Their experienced and highly skilled team support the pension planning needs of independent financial advisers and their clients across the UK.

Strategic opportunities

Praemium currently operates its discretionary investment platform in the UK using the company’s proprietary Separately Managed Account (SMA) technology, offering advisers access to investment options through Individual Savings Accounts (ISAs) and General Investment Accounts (GIAs).

However, around two-thirds of household wealth in the UK comes from private pension savings. SIPPs, UK government-approved personal pension schemes, are the fastest-growing segment of the UK pension market, providing a flexible and tax-efficient way to save for retirement. There are currently over one million SIPP schemes in a market that is rapidly expanding, due in large part to recent legislative changes in the UK. Platform-based SIPPs have captured a large part of this growth, accounting for around half of all current SIPPs.

This strategic acquisition allows Praemium to enter the UK private pension space and access a significant new source of funds under administration (FUA) via its existing adviser relationships. The acquisition of Wensley Mackay provides Praemium with immediate access to the market, supported by a company with a strong reputation for service delivery.

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Praemium CEO Michael Ohanessian commented, “In the UK, platform providers have seen the retirement market open up following pension reforms introduced in April 2015 that demandated the use of annuity investments. Investors are exiting annuities and seeking other options for their retirement savings, with a major shift to pension schemes like SIPPs that offer a wide range of investment options.

“Accordingly, adding a SIPP solution to our UK platform proposition enhances our growth prospects by offering a complete package to our clients. When coupled with our range of innovative investment products, such as the 80% Capital Protected funds that are ideal for retirees, we expect considerable upside from our UK and international distribution channels.”

Wensley Mackay Managing Director Paul Wensley said, “I am incredibly proud of what we have achieved at Wensley Mackay over the last 24 years. This deal offers a fantastic opportunity to grow the business and continue to deliver the high quality service for which we have become known to a much larger group of financial services professionals and clients in the UK.”

About Praemium (ASX: PPS): Praemium is a global leader in the provision of investment administration, Separately Managed Account (SMA) and financial planning technology platforms. Praemium administers in excess of 300,000 investor accounts covering approximately $80 billion in funds globally, and currently provides services to approximately 700 financial institutions and intermediaries, including some of the world’s largest financial institutions. For further information contact: Mr Paul Gutteridge, Company Secretary +613 8622 1222