Q: Thoughts on their purchase of Richardson Wealth? I know it's not a large purchase for them give mkt cap considerations, but do you think the gap they are filling makes sense for their investment division? Does their history in the space give you confidence that they can effectively integrate the purchase?
5i Research Answer:
We are not too concerned here, it looks like a solid deal. Richardsons has already noted to clients that very little is expected to change. IAG has done three other acquisitions of similar size in the past two years (one deal did not disclose the amount) and these have been successfully integrated with no known problems. While we might debate the 100% premium, we would not expects issues with the acquisition itself.