Sargon saga prompts likely fund admin shake-up


by Greg Bright

OneVue, the largest third-party retail unit registry provider in Australia, last week announced a takeover of its major advisory client, Madison Financial Group. Meanwhile, Link Group has strengthened its funds admin team with a senior hire from NAB. Coupled with Sargon’s troubles, this looks a lot like the sector is in play.

With Sargon’s Australian business going into administration, as reported in last week’s (February 3) edition, and its New Zealand subsidiaries suffering from the fallout from that problem – even though Sargon says they are not in administration nor receivership – the ASX-listed OneVue looked to shore up its defences. Madison, which has an estimated 100 financial planners within its dealer network, is owned by a Sargon-affiliated company.

You’d have to think that this mess will be cleaned up fairly soon. The question is: ‘who will be the winners and who will be the losers?’. For instance, OneVue shares fell 8.5 per cent after the stock came off the trading halt on January 30 and back on the market on February 3. But it regathered quickly to a decline of only 4 per cent just moments later.

According to the daily trade press, such as ‘Financial Standard’: “On Wednesday (February 3), the receivers appointed to Sargon – Chris Hill and Danielphi Walley of PwC, were said to have secured Sargon’s holdings in Sequoia, representing a 19 per cent stake of the total ordinary shares. The shares were estimated to be worth approximately $4.6 million, based on Tuesday’s closing price of 20 cents per share.”

In a statement to the ASX, OneVue said it, and the receivers: “Will be working with Madison to enable a sale of the business, such that the business can continue to operate on a stable footing without unnecessary distractions. As part of this process, the Sargon rebranding of Madison has ceased and will continue to operate under the Madison name. Further, OneVue said the operating business of Madison is not subject to any form of insolvency proceedings and it continues to operate on a business as usual basis.” Good luck with all that.

Meantime, Link Group, which has serious aspirations in the investment administration space, with the purchase of White Outsourcing in Australia in 2016 and then Capita Asset Services a year later in the UK. Last week, Link recruited Lachlan Allardice from NAB Asset Servicing. He is a long-time and well-regarded senior executive in the asset servicing space, having previously worked for J.P. Morgan and ANZ. His recruitment followed that of the head of the funds management business area, Paul Khoury, from State Street, and then, more recently, the recruitment of Peter Sipek, formerly COO of AMP Capital. In the specialised world of funds administration, Khoury and Sipek are both superstars. Khoury is chief executive of what is now known as Link Fund Solutions.