Value of reported AZ NGA bid raises eyebrows

Mike Taylor

Managing Editor/Publisher, Financial Newswire

27 June 2023

News reports that Paul Barrett’s Italian-backed AZ NGA rejected a takeover offer of just $600 million form a US private equity player has caused a stir amongst financial planning licensees struggling to please shareholders.

The report, published in the Australian Financial Review, named the US private equity firm as TA Associates and said the offer came after TA had become part of a process to draw in investors.

It said the offer had been rejected.

Financial Newswire has obtained a copy of the AZ Next Generation latest statement of accounts and annual report filed with the Australian Securities Exchange (ASX) showing it reported $141 million in revenue last financial year, representing an increase of $116 million over the previous year.

The documentation showed that profit before tax was $13.281 million up from $12.465 million the previous year with interest bearing debt increasing to $64 million, secured by a letter of credit from the Italian parent company.

The level of TA Associates offer became a topic of discussion among financial planning licensees because it contrasts with much more modest outcomes reported amongst the publicly-listed players with AMP still yet to get its financial planning business back to break-even and with Insignia facing not dissimilar challenges.

While AZ Next Generation operates under a distinctly different commercial model to most of the publicly-listed licensees, its balance sheet compares to CountPlus which reported net profit after tax of $7.2 million last financial year while Centrepoint Alliance reported profit after tax of $3.029 million.