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- Release Date: 26/02/13 10:30
- Summary: ASSET: TWR: TOWER sells investments business
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TWR
26/02/2013 08:30
ASSET
REL: 0830 HRS Tower Limited
ASSET: TWR: TOWER sells investments business
MEDIA STATEMENT
26 February 2013
For immediate release
Market Information
NZX Limited
Level 2, NZX Centre
11 Cable Street
Wellington
New Zealand
Company Announcements Office
Australian Stock Exchange Limited
Exchange Centre
Level 6, 20 Bridge Street
Sydney NSW 2000
AUSTRALIA
TOWER sells investments business
(Auckland - NZ) TOWER Limited today announced that it has sold its
investments business TOWER Investments to Fisher Funds for NZ$79 million.
Fisher Funds is a New Zealand owned and operated fund manager and KiwiSaver
provider, managing more than $1.4 billion on behalf of more than 130,000
investors.
TOWER Group Managing Director Rob Flannagan said "the decision to sell TOWER
Investments was made as a result of a comprehensive strategic review of what
is best for TOWER and for TOWER's shareholders."
"This evaluation was undertaken primarily to identify opportunities for TOWER
that would provide value for shareholders," Mr Flannagan said.
The sale follows the divestment of TOWER's health insurance business to
Australian private insurer nib holdings ltd in November.
Mr Flannagan said that "the TOWER Board made the strategic decision to narrow
TOWER's focus. TOWER has entered into arrangements with the purchasers of
those businesses to continue to distribute both Investment and Health
products providing a seamless service to its customers."
TOWER's narrower focus will provide more market visibility for TOWER's
strong, ongoing businesses and enable the equity market to better recognise
the value of TOWER's shares. TOWER will continue to assess whether there are
opportunities to obtain further value for shareholders following the
strategic review undertaken last year.
"The focus for TOWER going forward will be on growing our traditional core
insurance business through offering superior products backed by
market-leading customer service," he said.
The sale of TOWER Investments to Fisher Funds is on terms customary for a
transaction of this type, including that no material adverse change occurs in
either TOWER Investments or Fisher Funds prior to Completion. Subject to
satisfaction of this condition, Completion is scheduled to occur on 2 April
2013.
Carmel Fisher Managing Director of Fisher Funds commented:
"This is an exciting opportunity for Fisher Funds to participate in the
consolidation of a competitive KiwiSaver industry, accelerate our growth, and
achieve economies of scale that we can pass on to our clients. We are
delighted to have the support of our new shareholder TSB Bank in this
acquisition, along with the continued support of existing Fisher Funds
shareholders including Morrison & Co."
TOWER Investments has been sold as a stand-alone business with employees
transferring across to Fisher Funds with the business.
Mr Flannagan said "an announcement regarding the application of sale proceeds
realised from the sale of the investments business will be made in due
course."
Shareholders will be asked to approve a proposed return of capital of $120
million following the sale of the health business at TOWER's annual meeting
on 21 March 2013.
He said TOWER Investments, under its new owner, would continue to play an
important role in growing the wealth of New Zealanders.
"Over the coming months, TOWER will work closely with Fisher Funds to ensure
that investors are provided with the high standard of service they enjoyed
with TOWER Investments," Mr Flannagan said.
Ends
For further information, please contact:
Rob Flannagan
Group Managing Director
TOWER Limited
Tel: + 64 9 369 2084
ARBN 088 481 234 Incorporated in New Zealand
End CA:00233414 For:TWR Type:ASSET Time:2013-02-26 08:30:08
