Beacon acquisition collapses, IIOF fund in spotlight

Beacon Financial Group has confirmed it has terminated its agreement to acquire Linchpin-owned advice firm Libertas Financial Planning after it failed to meet its buyout commitments and defaulted.

It is understood that Linchpin Capital, the parent group of Libertas, agreed to pay $2.7 million to owner Mark Euvrard and made an initial payment of $700,000 from Linchpin’s troubled IIOF fund.

However, the agreement fell through after Linchpin failed to meet its buyout commitments and defaulted.

“In simple terms, we were unable to continue funding the acquisition and Mark Euvrard exercised his rights under the contract to take back the company and proceed independently,” Beacon managing director Peter Daly said in an email to advisers.

“We welcomed the opportunity to work alongside Mark and the Libertas advisers and will miss the relationships built.

“I should like to take this opportunity of wishing Mark and his advisers continued growth and success.”

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A troubled history

In July, ifa reported that Melbourne investment manager AD Capital pulled out of its announced merger with Linchpin following court proceedings brought against the dealer group owner by ASIC.

Then in August, it was reported Linchpin Capital and Endeavour Securities could have their assets placed into receivership in light of a judgement handed down by the Federal Court following proceedings brought against it by ASIC.

The case was brought against Linchpin after ASIC found it had been operating two funds without the appropriate licence, however Linchpin fought these allegations.

Most recently in September, Mr Daly admitted he planned a JV with Sydney advice business, National Financial Advice Alliance, a business that collapsed owing $450,000 to the Linchpin IIOF fund.

Further, ifa reported “serious fears” from Beacon advisers that they will be unable to recoup client money that was invested in the fund.

The IIOF fund is currently at the centre of an ASIC investigation.

More to come.

Beacon acquisition collapses, IIOF fund in spotlight
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Adrian Flores

Adrian Flores

Adrian Flores is a deputy editor at Momentum Media, focusing mainly on banking, wealth management and financial services. He has also written for Public Accountant, Accountants Daily and The CEO Magazine.

You can contact him on [email protected].

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