Friday 22nd September 2023
Count picks up Diverger in blockbuster licensee acquisition
The purchase comes after a turbulent couple of years for Diverger, which was formerly a collection of dealer groups under the Easton Investments banner.
Converged advice and accounting group Count Limited will acquire licensee group Diverger in a $45.3 million deal that will bring its combined funds under management to a total of $29 billion with projected revenue at $132 million per year.
Both entities announced the deal to the ASX Friday, with Diverger’s primary shareholder HUB24 backing the transaction and conveying its intention to vote for the merger. The deal will bring 146 financial planning practices under the Diverger banner into the Count stable, which currently homes around 380 financial advisers.
In total, the new group should house approximately 550 advisers, 563 accountants and a “significantly expanded” services regiment according to Count’s ASX statement.
The move comes on the back of a turbulent period for Diverger, which was originally a collection of dealer groups including GPS Wealth, Merit Wealth and Paragem (purchased from HUB24 in 2021) branded under the Easton Investments banner. Shortly thereafter, Easton changed its name to Diverger Limited.
Ex-Commonwealth Bank head of wealth Hugh Humphrey (pictured) was appointed CEO of Count in mid-2022, succeeding Matthew Rowe, who went on to be named CEO of SMSF administrator SuperConcepts in mid-2023.
The rationale for the acquisition, according to Count, hinges on Diverger being a “highly complementary business” to the provider and affording the company increased scale across its wealth, accounting and service divisions. Count expects the transaction to deliver a “material increase in scale and diversification of Count’s revenue earnings as well as unlock incremental growth opportunities”.
“Count has identified approximately $3 million in cost synergies, and a number of new revenue growth opportunities to be delivered through a rigorous integration and benefit realisation program,” the statement read. “Upon completion, Count will benefit from a broader and more diversified shareholder base.”
Pre-tax benefits of approximately $3 million are targeted in the first full year post-completion, with integration costs pegged at around $8 million.
The transaction is expected to be implemented in the first half of the 2024 calender year.
