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June 1, 2020updated 09 Jul 2020 9:48am

Sequoia acquires Phillip Capital customer base

Sequoia Wealth Management has signed a sale and purchase of assets agreement to acquire the customer base of Phillip Capital (PCL).

Under the agreement, Sequoia Wealth Management (SWM) will take over PCL’s existing advisers as well as corporate authorised representatives.

From the middle of next month, these representatives and advisers would become authorised under SWM’s AFSL.

“The client list of the 23 PCL advisers (5 in QLD, 4 in NSW, 14 in VIC) will be sent a negative consent letter by them in coming days with the client transfers and the adviser commencement with SWM expected to take place before mid July 2020,” Sequoia stated in a stock exchange filing.

The deal brings around 5,500 equity accounts to Sequoia’s executive and clearing business, Morrison Securities.

It also boosts Sequoia’s funds under advice by nearly A$1bn ($676.6m).

Upon migration, PCL advisers can maintain their current entitlements and conditions. They have been provided agreements in this regard.

The deal may be worth up to A$1m, based on the number of advisers accepting the offer.

Sequoia will finance the transaction using existing liquidity as well as the “assumption by SWM of existing adviser entitlements”.

The firm expects the deal to support revenue and performance over the coming years.

“In addition to the revenue and profit benefit for SWM, the new accounts should add a 15% increase in clearing and execution transactions for Morrison and the revenues generated from this functionality will be absorbed without significant additional cost,” Sequoia said in a statement.

Sequoia recently snapped up YBR Wealth Management advisers.

Last year, it purchased Libertas Financial Planning, a financial advice dealer group.

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