Hub24 rejects sale proposition

By Alice ·
January 29 2016

Hub24 rejects sale proposition

Hub24 is not looking to sell, with managing director Andrew Alcock indicating that any business looking to purchase the company must be willing to pay an "extraordinary premium".

Speaking to Adviser Innovation's sister title ifa, Mr Alcock said the platform provider is focusing on its strategy in an attempt to avoid being "distracted" by potential offers.

"Our board is very supportive of the strategy we've got...we're building something quite unique, we're growing rapidly and we're having record growth. So why would you sell a business when you're experiencing that amount of growth?" he asked.

"You'd have to be willing to pay an extraordinary premium for people to say yes. We believe that our prospects are really, really strong and we're going to create more value if we invest in our strategy rather than selling the business."

Mr Alcock confirmed that Hub24 had not received any further purchase offers since last year's ill-fated attempt by financial services giant IOOF - and added that IOOF had not come back for a second stab.

"We're not trying to sell the business; we're trying to build our business and if we have an offer we'll look at it. There have been no other offers, but I'm sure we're above the radar and it's all very interesting," he said.

"Whether or not IOOF come back with a counter-offer is completely up to them. If they come back we won't be distracted by that. If we get an offer, we'd have to consider it, but it would have to be a substantial offer for us to be distracted from our core strategy.

"IOOF made an offer but we said, 'That's too low, go away'."

In October last year Hub24 rejected IOOF's offer to acquire 100 per cent of its shares, saying it was "inadequate".

In a statement to the ASX, Hub24 said it had considered IOOF's indicative, non‐binding and conditional proposal to acquire 100 per cent of its shares for the cash consideration of $2.75 per Hub24 share, and rejected it because it "does not reflect the underlying value of Hub24".

Mr Alcock added that while Hub24 is not actively looking for buyers, he is not surprised the company had caught IOOF's eye.

"I'm not surprised at all because of how we're rated. We're a little bit of trailblazer so we're drawing attention. So it's not surprising that others would be looking at us, asking how they can leverage that technology and our business for their own purposes," he said.

Last week, Hub24 reported its funds under administration (FUA) had hit $2.37 billion, following record inflows for the second quarter of 2015-16.

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Hub24 rejects sale proposition

Hub24 rejects sale proposition

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