NZ financial services conglomerate, Amplifi Group, has wrapped-up a second advice business acquisition with the purchase of Auckland-based boutique, Prosperity Partners last week.
Prosperity will fold into the Amplifi home-brand Sage Wealth Management, launched earlier this year under the leadership of former Hobson Wealth adviser, Aga Krzeczkowska. Trish Lynds, Prosperity founder, remains in a client relationship role with Sage post purchase while administration manager, Katie Visser, also stay on under the new ownership.
Amplifi, a joint venture between Mint Asset Management and local private equity player Ascentro Capital Partners, bought the Nelson financial advice shop, Tōtara Wealth Management, last May in its first foray into the market.
However, Tōtara continues to operate under its own brand in a flexible approach that Amplifi managing director, Fred Ohlsson, said respects the goals of different businesses.
“We like to have two models [of branding],” Ohlsson said. “Prosperity, for example, like Sage is an Auckland city business while Tōtara has a strong presence in Nelson. Possibly, regional firms will be more likely to keep their brands while metropolitan businesses use Sage.”
Regardless of naming conventions, he said Amplifi expects to add more independent investment advisory practices to the group as regulatory forces and demographic trends create demand for more corporate rigour in a historically fragmented and bespoke industry.
“There’s a growing need for financial advice in NZ as people grow their wealth and move into retirement… and there is a need for us to help advisers become adviser businesses,” Ohlsson said. “Many advisers are the business but the transition [to a more corporatised model] is necessary.”
He said Amplifi provides regulatory compliance and governance support as well as potential access to new clients and referral networks. Sage, for instance, has appointed consultancy firm, Makao, as an independent adviser to the investment committee.
“But we believe in independent, fee-for-service financial advice. There is no product-peddling or requirements for advisers in the Amplifi group to use Mint products,” Ohlsson said. “Our view is that the independent financial advice business is an investment proposition in itself.”
However, as the long gap between buying Tōtara and Prosperity illustrates, convincing boutique advice practice owners to join a larger enterprise is no easy task.
“We were in conversation with Prosperity for a while,” he said. “Selling a business is always emotional and it takes time to find the right partners who will respect your clients and the independent advice model.”
Lynds said in the release that the Sage move would ensure a smooth “transition” for Prosperity clients.
“I am pleased to have found a business that aligns with the Prosperity Partners philosophy and independence and who will continue to help and support our clients’ future financial advice needs.”
Ohlsson, who previously held senior group executive roles for ANZ in Australia and NZ, said Amplifi was “investing for the long term”, targeting further advice and other financial service business acquisitions.