The for-sale ASB-owned Aegis platform could lose north of $3 billion in funds under administration (FUA) after Hobson Wealth confirmed last week it would move to rival NZX-owned system.
Hobson, then known as Macquarie NZ, was about to jump from Aegis in 2016 but froze the deal in mid-2018 as NZX Wealth Technologies faced delays in transitioning its first new client, Craigs Investment Partners.
In the NZX half-year report published earlier this month, head of NZX Wealth Technologies, Lisa Brock, said the now $2.1 billion platform had “a strong sales pipeline opportunity in excess of $40 billion”.
Mark Peterson, NZX chief, said in a release last week that Hobson would “be the second significant client that NZX Wealth Technologies will on-board to its new platform” in a deal expected to complete in 2020.
“We are pleased that Hobson Wealth Partners has chosen NZX Wealth Technologies to provide its platform technology services for its custody business,” Peterson said in the statement.
Hobson’s choice could put a serious dent in the Aegis sale price, which current owners, ASB, hung out for sale again this May. It is understood ASB was seeking up to $70 million for the pioneer platform, attracting a reported four serious bids from local and Australian firms.
NZX itself is rumoured as one of the potential Aegis buyers.
Aegis reported FUA of $15.2 billion at the end of March this year, ranking it for the first time behind long-time competitor, FNZ, which now has in excess of $16 billion sourced from NZ clients.
According to the Aegis website, since launch in May 1998 the platform “has grown to administer $15bn on behalf of more than 19,000 investors, and is the investment administration service of choice for more than 90 groups of investment professionals throughout New Zealand”.
But Hobson may not be the only Aegis defector before the sales process concludes. According to sources, the Westpac wealth management business is also close to ending its long-standing Aegis relationship.
If Westpac does de-platform, Aegis could see a further $3-4 billion disappear off its register.
In the release, Hobson head, Warren Couillault, said the transition to the NZX platform “will improve our client service offering”.
At any rate, much of the background legal work is already in place. NZX Wealth Technologies formed the Hobson Wealth Nominees custodial holding company in February 2017.