Bank of Queensland (BOQ) yesterday announced it had acquired Virgin Money Australia (VMA) for $40 million and appointed former Colonial First State chief executive Brian Bissaker to run the business.
Mr Bissaker joined BOQ in February as a wealth consultant having departed the Commonwealth Bank Group in May last year after a restructure.
The total purchase consideration includes $30 million in BOQ shares, subject to a 12-month holding lock, BOQ said in a statement to the Australian Securities Exchange.
The Virgin Group will gain a seat on the BOQ board. Incumbent Virgin Money managing director David Curneen will leave the business but act as a consultant for a period, according to the statement.
BOQ said the move will extend the bank's reach into "currently untapped, complementary customer and market segments, providing access to an iconic brand with proven capability in online customer acquisition and product distribution".
Under the deal, BOQ gains exclusive Australian rights to the Virgin Money brand, which has over 150,000 customers in areas BOQ said are currently "untouched by the BOQ brand", with a complementary footprint across credit cards, life insurance, general insurance and superannuation.
BOQ said the business is still considered a start-up and is currently a loss-making business, but should deliver a positive and fast growing earnings profile. BOQ expected the acquisition to be earnings accretive in the second full year of ownership.
BOQ manufactured products will be distributed under the Virgin Money brand, which BOQ said should offer potential upside. "A detailed product and distribution strategy is in development," the bank stated.
BOQ expected the acquisition to be complete, with all conditions satisfied, by April 30.
