CBA has announced an agreement with John Symond to increase its investment in Aussie Home Loans initially from 33% to 80% - paying an estimated $200 million - with the right to subsequently move to 100% ownership.
Symond will remain as executive chairman and Aussie will continue to operate as a standalone mortgage broker and financial services provider. He told reporters yesterday that he's pleased with the deal.
“We welcome this arrangement as CBA’s increased interest in Aussie is a great opportunity for the company to further accelerate our growth. We now have the opportunity to grow by investing in our product and service offerings and will remain a strong competitor in the mortgage broking channel."
CBA group executive group strategic development, Rob Jesudason says the bank recognises the strength and reputation of the Aussie brand and name in the Australian mortgage market and the importance of broker distribution of home loans and other financial products.
“We are delighted to increase our investment in Aussie and continue the relationship between the Commonwealth Bank Group and Aussie. We are committed to providing innovative and competitive services to our customers.”
Jesudason says that, for Aussie, it will be “business as usual,” as it continues to provide services to brokers and lenders in the way it always has.
The acquisition of Aussie is dependent on the Commonwealth Bank obtaining informal clearance from the Australian Competition and Consumer Commission.
The financial terms of the acquisition are confidential; however the transaction is not material to the Commonwealth Bank.
The Sydney Morning Herald reporter Eric Johnston says that, given CBA chief executive Ian Narev played a key role in the acquisition of the stake in Aussie Home Loans in late 2008, analysts have long speculated that he was likely to move to a full buyout - or at least lift his holdings in the business.