There have been concerns in the industry that Fisher Funds is buying back KiwiSaver default status after losing that position in a government review last year.
Kiwi Wealth is a default provider and manages more than $450 million for nearly 60,000 savers.
In a statement Fisher Funds says it will seek to retain Kiwi Wealth’s default KiwiSaver status. "However, there is a formal approval process to be worked through over the transition period."
Under the deal Fisher Funds will have a distribution relationship with Kiwibank - were the majority of Kiwi Wealth's KiwiSaver members have come from.
In this "strategic partnership" with Kiwibank, the bank will refer KiwiSaver customers to Fisher Funds.
Kiwibank chief executive Steve Jurkovich said he was excited about today’s announcement and that he looked forward to working with Fisher Funds to help customers take action to secure their financial future.
“This partnership delivers on our growth strategy and will enable Kiwibank to continue to offer KiwiSaver and other wealth products to our customers, delivering on our purpose of Kiwi making Kiwi better off,” he said.
Other concerns about the deal are the loss of jobs at Kiwi Wealth. The companies have downplayed this in their announcement although confirmed that "the Kiwi Wealth business integrated into Fisher Funds over time."
"There will be no immediate change for customers or staff as each business will continue to operate separately," the announcement said.
"Once the deal is completed, Fisher Funds and Kiwi Wealth will begin to work through a transition period to identify opportunities to grow the value of the combined businesses."
Fisher Funds chief executive Bruce McLachlan said “our priority is now on working closely with Kiwi Wealth to ensure a seamless transition for all members and clients involved.”
McLachlan says the deal is a natural extension of the company’s long-term growth plans.
“This is an exciting moment for Fisher Funds and will further strengthen our position as a leader in New Zealand’s active funds management business,” he said.
The acquisition is conditional on approval by the Overseas Investment Office. This is due to Fisher Funds being 34% owned by TA Associates based in the US. TA Associate also owns Russell Investments and recently Australian asset manager Yarra which last year bought Nikko's Australian business.
The remaining majority share is owned by the Toi Foundation, a New Zealand community trust which also owns TSB.
| « [The Wrap] One good deal; One dud deal | Tough times ahead for NZ economy: Nikko economist » |
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