Aegon said the move is going to create the UK’s largest platform business and Paraplanners told Financial Planning Today magazine they expect to see more deals.
Nathan Fryer CertPFS (DM), owner/director of outsourced Paraplanning firm Plan Works, believes the cost of keeping up to date with technology was “really beginning to hit home”.
He said: “This was highlighted in the recent sale of Cofunds by L&G to Aegon for £140m. This was a discount rate compared to their valuation of £175m in 2013 when they bought the rest of the 75% share capital.
“This, I believe, speaks volumes in our world and I think we will see more consolidation as companies begin to realise the true scale of both the on-going technology and staffing costs.”
For the full article on platforms, including Aegon's plans for Cofunds, click here.
He said: “What will be a concern amongst advisers is the on-going due diligence requirements when consolidations occur.
“I don’t think we will immediately see huge books of assets move from one platform to another simply because of the administration costs to the adviser, but what we will see is a gradual shift, probably carried out at client annual reviews if advisers have concerns about the on-going platform suitability.”
Kim George FPFS TEP, co-owner of Integrated Paraplanning Solutions, said: “I think that further consolidation is inevitable as more businesses recognise the bottom line value of vertical integration and seek to acquire the distribution channels and infrastructure to make it happen.”
Gemma Siddle, Financial Planning Director at Eldon, said: “I think more consolidation will happen – just as any products that have low take-up rates are eventually phased out of the market so will be true of platforms. There is a huge range available at present but, as mentioned above, the kind of development required to keep a platform useable and competitive is expensive.
“Platforms look attractive to all sorts of buyers. A struggling platform could provide legacy business. A thriving one could provide a distribution channel.”
The second issue of Financial Planning Today, our new 40-page digital magazine, is now available to our email newsletter subscribers and is packed with news, features and comment for Financial Planners, Paraplanners and Wealth Managers.
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It takes just a few seconds and you will then be sent a link to the new publication by lunchtime today in our next daily newsletter.
The new editorially-independent digital magazine has exclusive content produced by a team of experienced financial journalists in London.
Financial Planning Today's second issue includes:
• Entrepreneurial Paraplanner Cathi Harrison on her growing business and her confidence in Paraplanning's future
• Comment on the heated Cashflow Modelling debate from the CISI's Campbell Edgar and Financial Planner Julie Lord
• Insights from PFS chief executive Keith Richard and Succession boss Simon Chamberlain
• Exclusive Report on Platforms post the Cofunds takeover - including Cofunds comments on planners' concerns
• New Investment and DFM section, with analysis from senior fund managers at Lombard Odier and Architas plus 180+ DFM providers listed
• A special News Report on Sipps after the capital adequacy reforms
• News summaries, company news, professional body events coming up...
And much more too...
The magazine has been launched by Portfolio Publishing, publishers of Financial Planning Today and Sipps Professional websites, both of which carry daily news to thousands of professional financial advisers.
Financial Planning Today Publisher & Editor Kevin O’Donnell said: “Our first issue was extremely well received and we're delighted to offer the only publication aimed exclusively at professional Financial Planners, Paraplanners and Wealth Managers. Our second issue is packed with features, analysis, comment and business tips.
"Readers can also click on much of the exclusive content in the magazine to learn more. We believe it's an invaluable read for all professional advisers who want to keep up with their profession and learn from their peers. The emphasis is very much on professional and business growth and readers have told us they value this hugely."
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