Section: Property
OFM Investment Group Ltd has boosted its funds under management through the $42.4 million acquisition of privately-owned property funds management group Century Funds Management Ltd.
OFM, which managed over $1 billion in funds before the acquisition, took on an extra $440 million in client investments through the purchase.
News of the deal provided a healthy boost to OFM shares which closed 14 cents or more than six per cent higher at $2.40.
The fund manager paid $26.8 million in cash and $15.6 million in OFM shares to buy 100 per cent of Century.
Known as Over 50's Mutual before it demutualised in 2001, OFM provides investment bonds that invest in property, equities and fixed interest; property funds; equity release products and insurance.
Century has 21 unlisted property funds that invest in office, industrial and bulky goods related property.
The Century buy is a continuation of OFM's corporate strategy, OFM managing director Chris Martin said.
"The acquisition of Century Funds Management fits perfectly within our corporate strategy - property is a key asset class in delivering both income and capital growth to our core over 50's market," Mr Martin said in a statement.
"Century's expertise and underlying profitability will also benefit OFM through facilitating a shift away from one-off property transaction revenues, to generation of a sustained earnings stream from property-related activities."
OFM said the acquisition will also provide it with a strong strategic position in the property funds management sector, inclusion of a new high-net-worth client base, and the potential to broaden distribution channels.
Century principals John McBain and Jason Huljich now indirectly own 9.9 per cent of OFM and will take on senior roles within the group.
OFM said all of Century's senior funds management staff will be retained
