ANZ continues on its self-inflicted diet with the news yesterday that it will sell its superannuation and financial planning businesses to IOOF Holdings for $975 million.
IOOF will pick up the OnePath pensions and investments business along with four aligned dealer groups as ANZ shifts to distributing rather than manufacturing advice and superannuation products.
The IOOF deal is a forerunner to the much bigger sale – the ANZ’s life insurance where talk remains that a decision is looming.
IOOF will enter a 20-year strategic partnership to distribute wealth management products though ANZ.
ANZ said the most recent annual profit for the businesses it is selling was $39 million, and it will take an accounting loss on the transaction of around $120 million.
ANZ has been spinning off assets as chief executive Shayne Elliott refocuses the lender on retail banking in Australia and moving out of trade related and corporate business in Asia.
ANZ Wealth Australia group executive Alexis George said the bank is still reviewing options for its life insurance business.
"By partnering with IOOF, we are able to create greater value for our shareholders while also providing our customers with access to quality wealth products," Ms George said.
"The sale of our P&I (pensions and investments) and ADG (associated dealer group) businesses provides ANZ with greater flexibility to consider options for the life insurance business including strategic and capital markets solutions."
IOOF will pay for the deal through a $450 million share placement to institutional investors, a $100 million share purchase plan and the remainder from taking on extra debt. IOOF shares were halted yesterday to allow the raising to take place.
It said it will become Australia’s second largest advice business by adviser numbers.
ANZ shares edged up 0.6% to $30.39.
