Fortnum, netwealth licensees set to merge

The combined dealer group will comprise 54 practices and 130 advisers in total.

13-Aug-2015

By Julie May

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Independent dealer group Fortnum Financial Advisers has announced that it will merge with netwealth-owned licensee Financial Planning Services Australia (FPSA) before the end of the year.

The proposed entity will be jointly-owned by Fortnum and FPSA’s 20 member firms, with the combined network to comprise 54 practices and 130 advisers in total.

Netwealth said today that the move followed a review of its core business operations and would release the group to focus on providing investment, superannuation and administration solutions.

Speaking to financialobserver, netwealth joint managing director Michael Heine said the netwealth Advice Group would retain other subsidiaries, which included salaried advice business Bridgeport Financial Services and Pathway Licensee Services, which catered to self-licensed advisers.

He told the publication the decision to merge FPSA and Fortnum was about creating size and scale in the current marketplace, and in turn enhancing the overall offering to self-employed advisers.

“FPSA wasn’t of a sufficient enough size to provide all the services advisers need, so the best decision we felt was to merge with a group that had the same philosophies and which could provide advisers with access to a more extensive range of dealer services,” Heine said.

The Fortnum Financial Advisers brand would be retained and there was potential for the FPSA brand to continue, however that was not something that had yet been discussed, he said.

“We haven’t gone over a lot of the finer details as we wanted to bring the announcement forward so that we could inform advisers at the FPSA professional development event we held today,” he said.

Meanwhile, Peter Boston who is currently head of advice development at netwealth, and close to FPSA and Pathway Licensee Services, would remain with netwealth, with Heine adding it was still early days in regard to what staff might transition across.

Under the proposed agreement, netwealth will continue to provide platform, managed account, financial planning software and compliance services to the broader Fortnum and FPSA group.

New managing director of Fortnum Financial Advisers, Joel Taylor, who was recently promoted following Ray Miles decision to step back from the day-to-day running of the Fortnum dealer group, said the merger would deliver cost and scale benefits, and expand Fortnum’s national footprint.

Further, he said advisory firms liked that Fortnum enabled them to be shareholders as they had a greater say in the direction of the licensee.

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