Financial Lifestyle Partners (FLP), a Melbourne-based financial planning business, is now the fourth practice acquired by Paul Barrett’s AZ Next Generation Advisory (AZ NGA), which lifts AZ NGA’s total assets under management to $1 billion.
Under the terms of the deal, AZ NGA has purchased 51 per cent of FLP and also committed to a share swap of 49 per cent of FLP’s equity for AZ NGA shares. These will be progressively bought back over the next 10 years.
Paul Barrett, AZ NGA chief executive officer, says he was attracted to FLP – which is part of Westpac’s Securitor Australian Financial Services license – largely because of its fee-based business model and strong referral network.
“They’re a perfect fit for what we’re trying to do, to attract high calibre people with strong long-term track records…it has youth and talent in its ranks and sees a long term future for its staff and clients.
“We can help them achieve a far longer term objective than they could have otherwise…[they have] a real growth orientation, the organic growth this firm has achieved has been very good,” Barrett says.
FLP was an early adopter of fee-for-service remuneration structures, having implemented this in 1994, before such approaches were mandated for investment advice and became increasingly popular in life insurance advice, as they are now.
Its “Client-4-life” service model is one of the practice’s flagship achievements, according to Craig Ralph, chief executive officer, FLP. He says his firm focuses their clients more on the lifestyle they wish to live than just financial objectives alone. “We believe we have a fiduciary responsibility to our clients. However, it is our approach to life planning that sets us apart.”
The practice currently has more than $100 million of assets under advice, with around 300 clients serviced by its seven staff. It provides holistic advice spanning investment and asset allocation, retirement planning, insurance, and strategic financial planning advice.
According to Barrett, the deal has been an 11-month work in progress, with Westpac having been fully cooperative and engaged throughout the process.
With the acquisition taking effect from today, FLP will continue under the leadership of Craig and Lisa Ralph, and senior staff members have all entered into long-term arrangements to ensure continuity of service.
“We are delighted to join the AZ NGA family and look forward to sharing the journey with other like-minded business owners and their teams. We believe this opportunity secures our futures as well as those of our staff and our clients,” Ralph says.
AZ NGA announced its first acquisition on May 8, 2015, when it acquired Eureka Whittaker Macnaught. This was followed by the acquisition of Pride Advice on May 27 and Lifestyle Financial Planning Services on July 15.
This latest deal marks the third institutionally-owned licensee acquisition for AZ NGA, with earlier acquisitions licensed by ANZ-owned RI Advice (Pride Advice) and CBA’s Financial Wisdom (Eureka Whittaker Macnaught and Lifestyle Financial Planning Services). However, Barrett emphasises the institutional link is not a pre-requisite, with a number of non-aligned practices also shortlisted for upcoming deals, the next of which is expected to be announced in October.
