Iress announced it has completed the sale of its MFA business to global software and software-enabled services provider SS&C Technologies (SS&C) for a total cash consideration of $52 million, with Iress adding that the proceeds of the sale will be used to retire debt.
The firm also said that the sales process for its platforms business is underway, with “interested parties in active consultation”.
Iress chief executive Marcus Price said: “In April, we outlined our plans for our managed portfolio of non-strategic assets. Our approach has been to set these businesses up for success and identify opportunities to realise value and a return of capital.
“Having now successfully completed the sale of MFA and launched the sale of our platforms business, we are now taking steps to accelerate our managed portfolio strategy to realise further value for shareholders from these assets.”
Iress’ MFA business has over $900 billion in funds under administration and delivers administration services connecting custodians, responsible entities, and fund managers with investors and financial advisers. Iress acquired the MFA business as part of the OneVue purchase in November 2020.
The divestment was first announced in August, with Mr Price commenting at the time that the transaction was an “important step” in the firm’s refreshed strategy.
“As outlined to the market in April, we are committed to reducing costs, driving growth in our core Australian businesses, and managing our portfolio of non-strategic assets for value and the releases of capital,” Mr Price said.
“SS&C is a natural home for the MFA business. They share our strong belief in supporting the financial services community through technology-powered solutions. We are confident SS&C is well placed to invest in the growth of the business for the benefit of both its clients and people.”
SS&C is a global independent hedge fund and private equity administrator and the largest independent transfer agency and record keeper.
Commenting on the company’s plans for Australia in August, SS&C head of global investor and distribution solutions Nick Wright said: “We are delighted that the MFA team will be joining SS&C. I’m confident our clients, employees, and shareholders will benefit from the MFA team’s expertise, and we look forward to working together to bring top-of-the line software and services to managed fund companies in Australia.”
Mr Price added there have also been a number of management changes to “accelerate its managed portfolio strategy”.
Harry Mitchell, who was appointed to the role of chief executive, wealth management, in April this year, has now taken on an expanded role as group executive for the UK, while chief financial officer Cameron Williamson will now be responsible for managing the divestment of the platforms business and “disentanglement and separation of our South African and Canadian businesses”.
“As a result of these changes to the composition of the managed portfolio, John Harris and Simon New will be leaving Iress. On behalf of the board and management team, I’d like to thank John and Simon for their many years of service to Iress. We wish them both well for the future,” Mr Price said.
“Iress is committed to continuing at pace on its transformation agenda, with our objective to be operating at Rule of 40 returns over the medium term, continued capital releases from the managed portfolio, a fully reset cost base and significant debt reduction.”
