Vertical integration forces Premium-Aus Unity deal

Australian Unity announced the finalisation of its acquisition of Premium Wealth yesterday.

The diversified financial services group has acquired close to 97 per cent of the dealer group after shareholders "overwhelmingly elected to accept the acquisition offer" on 22 December 2014.

It is expected Premium Wealth will retain its branding as it is subsumed into the Australian Unity personal financial services division.

The combined entities will have 106 financial planning practices with approximately $6 billion in funds under advice.

Commenting on the decision to merge, Mr Harding-Davis said FOFA has effectively closed down many organic growth options for his company.

"It became clear we would need to either engage in mergers and acquisitions of our own, or invite a like-minded organisation to partner with us, to enable us to compete in a predominantly vertically integrated world,” Mr Harding-Davis said.

"In the end, we thought the option of engaging with a culturally aligned entity to acquire us made the most sense, has delivered the best outcome for the shareholders and will, we believe, deliver the most benefits to each practice and their clients," he added.

Premium Wealth chairman and founder Simon Wu said his company was attracted by Australian Unity's long-term involvement in the accountants' market.

"Australian Unity is culturally and philosophically aligned with us," Mr Wu said.

"The business is a well-respected, 175-year-old mutual, and have always prioritised clients' best interest, advisory integrity, with an open architecture environment for investments and insurances," he said.