Praemium’s chief executive has confirmed the sale of its international business, which includes its UK platform, has entered the “next and, hopefully, final stage”.
The Melbourne-headquartered firm put its UK platform up for sale in July.
In an address to the Australian Securities Exchange today (November 17), Anthony Wamsteker said: “The sale process is continuing. I am pleased to report that it has entered the next, and, hopefully, final stage. We are currently negotiating a legal agreement and business separation terms.”
He did not identify who the business could be sold to.
Praemium’s international business includes the Praemium UK platform as well as businesses in Jersey, Dubai and Hong Kong and its investment management company Smart IM, and the customer relationship management systems Wealthcraft and Plum.
According to the Lang Cat, Praemium's UK platform has assets of £2.7bn and its used by 380 advice firms.
“This was an interesting decision for us to take,” Wamsteker said in his update to the ASX.
“On the one hand, the international business is performing brilliantly. Having committed to the international market for many years, the people currently leading that part of our business have really started to achieve the type of success that we always hoped to achieve.
“On the other hand, however, it still has a very small market share internationally - even smaller than what we regard as a sub-scale market share in our home market here in Australia. On balance, we decided to stop chasing two enormous opportunities and focus on one - and the one at home won out.”
Mark Sanderson, the head of Praemium's international business, added that the focus throughout has been on finding a new owner who was the right fit for the business and its clients.
“I can’t divulge any more details at this stage, except to say that we would not have entered this phase of the process unless we were relatively confident that acceptable terms would ultimately be reached,” said Sanderson.
“It should be noted that there is no certainty that the sale process will result in a binding transaction.”
The sale of Praemium’s UK platform is the result of a strategic review the Melbourne-based firm began back in May.
It showed that while the platform was enjoying strong sales and revenue momentum, it remained at a disadvantage to its competitors due to its smaller scale.
Alongside announcing the sale in July, Praemium said it had appointed Deloitte Corporate Finance to undertake the sales process.