Forsyth Barr buys Hobson Wealth to create $30b in funds under advice

Forsyth Barr is buying Hobson Wealth for an undisclosed sum, as GoodReturns reported several weeks ago was likely.

Tuesday, December 5th 2023, 3:24PM

by Jenny Ruth

Forbarr managing director Neil Paviour-Smith says combining Hobson with Forbarr's own wealth management business will create a team of more than 220 financial advisers working from Forbarr's 25 offices around the country and take funds under advice to more than $30 billion.
Hobson has more than $4 billion in funds under management and 35 advisers.

Including all the company's staff, Forbarr will have more than 600 people, including analysts, administration and IT people.

Paviour-Smith said the price paid is confidential but was “a mix of shares and cash.”

There is no earnout included.

Hobson's chief executive, Warren Couillault, said he will be joining Forbarr “in an integration, bedding down capacity.”

Paviour-Smith expects Couillault will want “to do his own thing” at some point next year.

The Hobson business is “a very relationship-centric model and is very similar to our's,” Paviour-Smith said.

Reportedly, Forbarr and Craigs Investment Partners were the final bidders.

Couillault, says his company has been “considering the strategic growth alternatives for Hobson Wealth over the past couple of years, looking for ways we can enhance services for our clients and help scale the business.

“We completed a comprehensive process and I'm pleased to say Forsyth Barr ticked all the boxes,” Couillault says.

Forbarr's extensive branch network and “market-leading offering in areas like research” should aid both client outcomes and provide Hobson advisers with opportunities for growth with another NZ and staff-owned business, he says.

Paviour-Smith says combining the two businesses will mean some cost savings which meant “we can make it work for both them and us.”

The two businesses started talking about a potential sale in the middle of the year, he says.

News of the potential sale started to leak when news broke that rival stock broking firm Jarden, which also has a large wealth management business which it is planning to separate from its other stock broking and merchant banking activities, was discussing a merger with National Australia Bank-owned JB Were wealth management business.

The last significant transaction in the funds management industry was Fisher Funds' $310 million purchase of Kiwi Wealth in August 2022.

Tags: Forsyth Barr