Following the acquisition, IOOF will cater to around 2.2 million clients
National Australia Bank (NAB) has wrapped up its previously announced A$1.44bn ($1.11bn) sale of MLC Wealth, the bank’s wealth management business, to IOOF.
The Australian bank’s decision to sell the business aligns with the strategic decision it took in 2018 to seek an exit of the wealth management business.
Apart from that, the sale is in line with its strategy of simplifying and focussing on its core banking business, while providing a stronger future for MLC Wealth.
National Australia Bank CEO Ross McEwan said: “This successful exit of MLC Wealth is a significant milestone on executing the strategic ambition, simplifying our portfolio and enabling us to focus on our core businesses.
“The collaborative effort between NAB, MLC and IOOF over the past nine months has allowed us to execute a safe transition, with speed, that will benefit members and customers.”
The deal, which was announced in August 2020, would help IOOF become a top wealth management company in Australia. Its funds under management and administration (FUMA) will increase two-fold to A$494bn ($382.47bn).
An additional 406 financial advisers from MLC Wealth have joined the Australian financial services company to help it grow the scale and reach of its advice business.
Based in Sydney, MLC Wealth serves nearly 1.1 million members through its financial advisers. With its addition, IOOF will now cater to a total of around 2.2 million clients.
IOOF also expects to become one of the largest super fund providers in Australia with over A$160bn ($123.88bn) of superannuation assets.
IOOF CEO Renato Mota said: “This acquisition is truly transformational for IOOF as it positions us as the leader of a new era of wealth management in Australia, giving us a strong platform for future growth.
“Today we become a new IOOF. We have the strategic intent, the talent, and now the scale, to deliver our advice-led wealth management proposition to more Australians than ever before.
“While this acquisition delivers immediate value to our shareholders, we consider its potential for medium and long-term value even more compelling.”