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Bank Of Queensland Buys Business Arm From Investec In Australia

Alisha Ramkaran

14 April 2014

has agreed to buy the professional finance, asset finance and leasing arms of Investec Bank (Australia), part of the Investec financial services group serving the UK, South Africa and Australia.

The purchase price was a consideration of A$400 million ($376 million); more than 310 people will be transferred to BOQ, according to a BOQ statement late last week.

BOQ will acquire all of the shares in Investec Bank (Australia) Limited.

For both the professional finance and asset finance and leasing businesses the agreement with BOQ represents a significant opportunity as they pursue their next phase of growth and recognises Investec’s investment in these businesses over the past few years, BOQ said.

For BOQ shareholders the acquisition is financially attractive and is expected to deliver approximately 2 per cent cash earnings per share accretion the first full year following the acquisition, and approximately 4 per cent in the year after, it said.

The acquisition will be funded by A$400 million equity raising and excess capital of A$54 million the acquisition.

The acquisition will provide BOQ with cross-selling opportunities and the potential ability to leverage the specialist models of the acquired business to enter other industry sectors. The asset finance and leasing business will add scale in specific channels and markets, while also enhancing leasing capability in vendor financing for BOQ Finance.    

When the transaction becomes unconditional further details will be provided.  It is subject to regulatory approval, with completion expected by the end of BOQ’s current financial year.