Zenith will buy the business (Chant West) for $12.5 million, subject to shareholder approval. The sale is expected to take place by the end of March 2020, and comes after CWL fielded “a number of enquiries”, according to CEO Brendan Burwood.
“Chant West has been a strong performer for CWL since we acquired the business in December 2015, achieving 11 per cent growth in customer revenue last financial year,” Mr Burwood said.
“We believe this proposal represents the best option for all stakeholders. The marriage of distribution capability and superannuation expertise should enable Chant West to invest in additional growth of its independent research and data capability, and the completion of this transaction will enable CWL to return funds to its shareholders.”
CWL anticipates having a cash surplus of approximately 10 cents per ordinary share and intends to return the surplus cash to shareholders “as soon as practicable”.
The combined business will employ more than 70 staff and have an office location in both Sydney and Melbourne. Part of Chant West’s appeal to Zenith was its established relationships with the majority of funds management firms offering investment products to local investors.
“We’re very pleased to welcome the Chant West team and client capabilities into the Zenith business,” said Zenith CEO David Wright.
“This is a logical fit for our growth plans to better serve an expanded client base with unbiased research, consultancy and online tools, especially at a time when the broader super, pension and advice markets are undergoing considerable change and further evolving how they serve their clients and members.”
CWL will retain Enzumo, its financial planning technology solutions business.
