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Morningstar to buy Praemium for £35m

Morningstar to buy Praemium for £35m

Morningstar is to acquire wealth management platform Praemium for £35m.

According to an announcement on the Australian Securities Exchange this morning (December 21), Morningstar will acquire Praemium’s operations in the UK, Jersey, Hong Kong and Dubai.

Praemium was looking to sell so it can focus on growing in the Australian platform market.

The deal remains subject to regulatory approval and is expected to complete during Q2 or Q3 2022.

Daniel Needham, president of wealth management solutions for Morningstar, said: “Technology is playing a larger role in everyone’s lives and expectations for how companies deploy it are evolving quickly. 

“Advisers and the investors we jointly serve are no exception, and Praemium’s digital-first capabilities will allow us to reduce friction, lower costs, provide more choice, and improve efficiency for advisers. This gives advisers time back to deliver better advice, empowering investor success.”

Praemium used by nearly 500 IFAs. Its technology will add to Morningstar’s existing data, fund profiles, portfolio analytics, and investment management services, creating a complete experience.

Praemium UK and international managing director, Mark Sanderson, said: “The focus throughout the deal process has been on finding a new owner that is the right fit for us and the right fit for our customers. 

“We wanted a committed parent with a long-term view and the resolve to uphold our best-in-class platform experience, free from customer disruption.

'We know with this proposed deal with Morningstar, we can confidently say we have found the perfect fit.”

Melbourne-headquartered Praemium put its UK platform up for sale in July after a review showed that while the platform was enjoying strong sales and revenues, it remained at a disadvantage to its competitors due to its smaller size.

The acquisition comes at a time when wealth management platforms are experiencing significant growth. 

According to the Lang Cat, platform assets in the UK alone have doubled in the last five years exceeding £500bn, driven by adviser demand for scalability, digitisation, and portfolio flexibility.

There has been a lot of movement in this area with platforms changing hands over the last couple of years.

In March, Abrdn sold Parmenion for £102m to private equity firm Preservation Capital Partners. This came after Novia was snapped up by fellow private equity firm AnaCap Financial.

In May 2020, M&G agreed to buy the Ascentric platform from Royal London.

amy.austin@ft.com

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