MFS buys another advisory firm
MFS has picked up another South Island advisory firm to add to its growing Vestar chain.
Friday, April 13th 2007, 5:59AM
This is the fourth firm acquired by MFS in recent months. Others to be bought include Northplan, Jones Financial Planning in Rotorua and Swains in Invercargill.
Both Swains and Strang had existing relationships with Northplan before it was bought by MFS and renamed Vestar.
Northplan last year took a 50% stake in Strang's business.
Colin Strang told Good Returns the deal was logical as he had an existing relationship with Northplan which included the provision of back office services.
He says other firms had approached him, however he was more comfortable with MFS.
"We preferred this avenue as they are more nimble and we are not locked into product."
The deal is just for Strang's financial planning business. He also has a financial services business, run by his son, which looks after regular saving business.
This firm has around $40 million in funds under management. In addition to that there is the life insurance side of the operation which has annual premium income of around $4 million a year.
Strang remains contracted to Vestar for a number of years: "I'm staying on for the foreseeable future. I'm not ready to retire yet."
He says the deal provides some certainty for his clients if anything happens to him and it also provides a succession plan.
Stang wouldn't disclose the price paid, suffice to say, "it was enough to get me to sign on the bottom line."
MFS says in a statement that: "The acquisition of Strang follows MFS’ purchase earlier this year of the Northplan Group and Swain Investment Services. The acquisition of Strang is another step in MFS’ strategy to create a significant New Zealand financial services provider."
"The acquisition of Strang brings the total funds under management and under advice within MFS New Zealand’s financial advisory businesses to in excess of $900 million. These businesses service more than 5,000 clients across New Zealand."
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