Countplus directors approved the $2.15 million four per cent stake, although in a statement to the Australian Securities Exchange (ASX) advised the group did not expect the acquisition to be earnings-per-share accretive in the near future.
Rather, Countplus said it represented a “strategic investment that complements CUP’s core business of accounting services”.
According to the statement, Class has previously indicated plans to list on the ASX around 2016, and is now cash-flow positive.
“Given our accountants speak very highly of Class, many of whom were early adopters of the Class system, it was not a hard decision to make this strategic investment, as it complements our core business of accounting services,” stated Countplus chief executive Michael Spurr.
“I’ve followed the progress of Class closely over the last few years and have been pleased to see their success, given the important role they have played in improving efficiency in SMSF administration for accountants. It’s exciting that we will now be associated as shareholders.”
According to the Countplus statement, Class has “transformed” the SMSF administration market and has experienced three straight years of triple-digit growth.
“Recognised as the industry leader, with five of the top 10 SMSF administration and accounting firms in Australia, Class is currently recording fund inflows of $750 million in SMSF assets per week,” the statement said.
Class chief executive Rajarshi Ray welcomed Countplus as “another institutional investor on our share register” whose addition as a shareholder would allow Super-IP to “more closely tap into their distribution and accountant partnership capabilities”.
Countplus noted that its chairman, Barry Lambert, is also the chairman of Super-IP but was not involved in the negotiation or decision-making process for the transaction.
