Centrepoint says Diverger offer fails to reflect its 'strategic value'

Centrepoint Alliance (CAF) has responded to Diverger’s offer to acquire all shares in the firm for a combination of cash and Diverger shares valued at $0.325 per share offer price.

In a statement posted to the ASX on Monday, CAF said it has reviewed the indicative offer and while it is “pleased” that it highlighted the firm’s inherent value, the board “does not believe the offer fairly reflects the strategic value of CAF”.

The firm emphasised that it services more than 500 highly qualified advisers who operate as authorised representatives under Centrepoint’s Licences, and 200 self-licenced practices.

“Centrepoint demonstrated its ability to execute its growth strategy by successfully completing and efficiently integrating the acquisition of ClearView’s Advice business in November 2021, as well as being one of the few licensees to achieve net adviser growth in this financial year, at a time during which many licensees lost significant advisers,” it said.

Industry consolidation, it noted, is a key theme that Centrepoint has pursued over the past 24 months.

“Centrepoint has significantly benefitted from the acquisition of ClearView Advice, which has consolidated a financially stable licensee with strong recurring revenue, high-quality advisers and industry leading services to these advisers.”

The firm confirmed it will continue to advance its own pipeline of strategic and synergistic consolidation opportunities, noting that it remains well positioned to do so with $12.5 million cash in the bank, a strong management team, a profitable business and supportive shareholders.

“Centrepoint is well advanced with plans to accelerate growth and diversify revenue by leveraging other capabilities such as Centrepoint Lending, scaling its investment business by extending its managed account offering, and investing in financial services technology to improve the efficiency of its advice processes,” it said.

CAF did, however, note that it would meet with Diverger next week to discuss the offer and will “update the market if necessary”.

Diverger entered the takeover bid, valued at a combined $63.6 million, with a 19.99 per cent share in Centrepoint Alliance it obtained via a call option with major shareholder Thorney Group.