Price of Morgan's KiwiSaver business revealed

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Kiwibank's purchase of Gareth Morgan Investments will cost it as much as $58 million, new financial accounts have revealed.

Friday, August 24th 2012, 3:22PM 2 Comments

by Niko Kloeten

The state-owned bank's parent company New Zealand Post has released its annual accounts, which show $43.5 million paid up front for GMI.

They also show that another $14.5 million is due to be paid at some point in the future based on GMI reaching certain milestones including the level of funds under management.

The accounts show GMI contributed $3.6 million of revenue and $1.2 million of net profit after tax between March 31 when NZ Post took over and June 30; according to NZ Post it cost $600,000 to make the acquisition.

"Had this business combination been effected at July 1, 2011, the revenue of the group from continuing operations would have increased by approximately $14.4 million, and the profit for the year from continuing operations would have increased by approximately by $4.8 million," NZ Post says.

The purchase of GMI, which had more than $600 million in its KiwiSaver scheme and $1.5 billion FUM overall, has made Kiwibank the sixth-largest KiwiSaver provider.

Niko Kloeten can be contacted at niko@goodreturns.co.nz

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