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Australian company MFS Ltd has agreed to buy financial services group Northplan for $52.5 million.
Northplan has about $670 million under management and holds strategic stakes in other financial advisory groups around the country which between them manage a further $330 million.
MFS Ltd, an ASX listed company part owned by investment bank Babcock & Brown, has about A$4 billion under management in Australia.
MFS will pay $42.5 million in cash with the balance in new MFS shares to some of Northplan's owners including founder and managing director Kelvin Syms.
Northplan provides investment, estate planning and financial advice to over 3,400 typically high net worth clients. It also provides back office and other services to its affiliated groups who advise about 1500 clients.
MFS New Zealand chief executive Jason Maywald said Northplan would eventually be merged with his company's existing local operations which include Australian mortgage backed finance company MFS Pacific Finance and a number of smaller property funds which between have about $420 million in assets.
The acquisition of Northplan was "a significant step in MFS' expansion plans in New Zealand and was the first in a series of transactions that would see MFS become an influential force in New Zealand financial services".
Maywald said MFS' New Zealand expansion strategy was driven by the introduction of KiwiSaver and the prospect of consolidation in the industry as a result of a more rigorous regulatory environment.
