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Advice and accounting converging: SFG

SFG Australia has heralded the integration of the financial advice and accounting professions, listing it as a key factor in its decision to acquire Lachlan Partners.

In a statement to the Australian Securities Exchange this morning, SFGA outlined the strategic thinking behind the $32.2 million acquisition, which added 55 advisers and accountants and approximately $606 million in funds under advice to the dealer group. 

“SFGA’s core strategic rationale underlying the Lachlan Partners merger is that it believes that the service required of financial advisers and accountants are converging,” said the statement authorised by managing director Tony Fenning.

“It is SFGA’s view that [high-net worth] and private company clients are demanding a more integrated service offering that covers their accounting and tax requirements, while also effectively managing their cash flows and getting the right structure and advice when it comes to accumulating wealth, planning for their retirement and managing their estate,” it continued.

The statement indicated this notion of convergent accounting and financial planning professions underpins its broader acquisition strategy, which has seen mergers with Jeena Partners in November 2011 and Life Financial Services and Spencers Accountants in June 2012, as well as its recent non-binding indicative proposal to merge with WHK Group.

Today’s statement also provided further guidance on the proposed WHK merger. “SFGA and WHK are strategically aligned and highly complementary and the combined businesses would have a market capitalisation of at least $700 million, based on yesterday’s closing prices,” the statement said.

The statement also indicated positive half-yearly results for the dealer group, with a 10 per cent rise in net operating revenue to $63.5 million and operating earnings before interest, taxes, depreciation and amortization up 14 per cent to $22.8 million, despite “continued challenging, albeit improving market conditions”.