The deal betweenIWLand Sanford was cemented further yesterday with the former increasing its stake in the latter to just under 20 per cent.
As part of the heads of agreement struck between the two groups IWL took 2,595,000 shares at $0.18 per share. IWL was also given the option of acquiring 5,190,000 shares at $0.19 per share but as at that date had only acquired 2,875,000 shares but with other on-market purchases, IWL now holds a 19.9 per cent stake of Sanford Limited.
Prior to these moves IWL held only 9.5 per cent of the group but with the new stake and as part of the purchase agreement Sanford’s Virtual Broker product will be rebadged as VisiBroker and tied to IWL’s financial planning software VisiPlan.
The deal will also result in research from InvestorWeb being made available to the 1200 financial planners who are existing clients of Sanford and both groups mutually promoting the products and services of the other.
However IWL’s efforts to increase its stake have met with some resistance with IWL chief executive Otto Buttula surviving a Western Australian Supreme Court action to remove him from the Sanford board.
As part of the deal Buttula was to take a place on the Sanford board and the court ruled against an application by a Sanford shareholder opposing the move.
The biggest impact of the deal was the cancelling of the proposed merger between IWL and IRESS with both groups stating the move was no longer in the interests of their respective shareholders.
In a statement to the ASX in October, Iress explained it was not part of its strategy to actively participate in businesses that were in competition with its core customer base of brokers and wealth managers.
