The Transaction is structured to release $A40m in cash consideration upon completion plus additional payments of up to $A20m over 12 months subject to agreed revenue milestones. Completion is expected in the second quarter of 2025 and is subject to Foreign Investment Review Board approval, novation of a material customer contract and customary warranties and indemnities.

Following completion, Iress will continue to provide certain services for a period of up to 18 months to assist in the transition of the Superannuation business to Apex Group’s ownership.

The announcement follows Apex Group last year establishing Apex Super – its Australian Superannuation business in partnership with data and technology platform provider Novigi – in response to a growing commitment to the broader Australian market and superannuation industry in particular.

Iress Group CEO, Marcus Price, said: “As part of our transformation, Iress has streamlined its operations to focus on our core strengths in software delivery and to exit businesses with a higher regulated service profile. Apex Group is recognised as a global leader in the provision of fund and asset servicing to regulated financial services businesses.

“We are delighted with this outcome, which is a great result for all parties – clients, employees and shareholders – and will see the Superannuation business strengthened under new ownership. Importantly, Iress will continue to play an important role in the growth of the Superannuation industry through the provision of advice and education software to funds and their members.

“Today’s announcement enables Iress to double down on our core markets and customers in Wealth, Trading and Market Data; while continuing to improve our operational strength underpinned by a robust balance sheet and improved earnings profile.”

Apex Group Founder and CEO, Peter Hughes, said: “We are very pleased that Iress’ Superannuation team and clients will be joining the Apex Group. Increasing member engagement and improving the member experience is a focal point of our industry. The Acurity platform is well recognised as a market leader, and we look forward to building on this ensuring readily available access to data and flexibility in order to support clients to increase their efficiency, scale and value to members.”

Flagstaff Partners acted as exclusive M&A advisor to Iress. Macquarie Capital acted as exclusive M&A advisor to Apex.

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• Australia’s advice industry is expected to grow by $2bn in revenue and 486,000 customers in the next five years.
• If all Australians could access better advice, the pool of national savings would be $2 trillion higher in 30 years.
• External factors such as shifts in competition, social values, demographics and client priorities provide opportunities for financial advisers to modernise their offerings and service a high growth market.
• Advisers are urged to proactively adapt to changes in clientele, products, technology, and business structure to stay competitive.

Deloitte Access Economics (“Deloitte”), in collaboration with Iress, has released the ‘Advice 2030: The Big Shift’ report which identifies seven megatrends that are set to shape the future of financial advice. The report anticipates that shifts in competition, climate impacts, demographics and client priorities will generate greater demand for specialised financial advice delivered through a customer-centric, technology-led offering.

Australia’s advice industry has the potential to grow from $6.1 billion in revenue to $8.2 billion by 2030, which is contingent on advisers scaling up to serve an expected 486,000 new customers. Additionally, consumers are demanding a broader set of advice support across retirement, intergenerational wealth transfer, wealth accumulation outside of the family home, natural disaster resilience and digital assets.

Beyond traditional advice, opportunities abound to tap into the estimated 11.8m Australians with unmet advice needs through scaled and digital advice offerings.

The Australian financial advice industry has been characterised by significant internal upheavals, including a 43% decline in advisers, major institutions selling their advisory arms, regulatory reforms, and decreased trust in the industry. Those advisers which have remained in the industry have proven to be remarkably resilient, and have seen profitability rebound to be generating 22% profit margins, with high performing advice practices able to achieve even higher margins representing $550,000 more in business profits annually.

While acknowledging the resilience of these advisers, ‘Advice 2030: The Big Shift’ outlines a suite of external factors that will profoundly impact the industry and act as stimuli for advisers to shift how their advice is delivered. Deloitte identified seven external megatrends that will influence the sector over the coming years:

1. Skyrocketing retirement demand: With an ageing population and increasing life expectancy, advisors can expect increased demand for self-managed super funds, greater competition with superannuation funds providing retirement advice, and an increased availability of government data.
2. Natural disasters and environmental volatility: 80% of Australia’s population has experienced natural disasters since 2019, increasing the need for financial advice linked to lifestyle and asset risk management strategies. Future advisors will need to navigate client trauma and the growing complexity in solutions required.
3. The “New” Australian Dream: For many Australians, the Australian dream of home ownership as a primary investment is out of reach, driving them to look elsewhere for wealth generation.
4. Digital delivery of everything: Advances in FinTech will enable cost-effective mass delivery of financial services and disrupt financial advice, emphasising the importance of deep client tailoring and identifying varying pricing strategies.
5. The Grey Tidal Wave: As the baby boomer generation enters retirement, Deloitte predicts a growing demand for new products and strategies that provide more holistic financial advice that will facilitate a significant wealth transition.
6. The Green Wave of Future Investing: As clients increasingly seek investments that align with environmental, social and governance (ESG) principles, advisors will play a complex role in balancing risk and performance, incorporating ESG factors into investment strategies and conducting due diligence.
7. Digital assets: The rise of digital assets, cryptocurrency, blockchain and fintech innovations with increasingly borderless financial systems will create a need for advice about investing while managing security, risks and tax implications.

Rice Warner (part of Deloitte) estimated that if all Australians could access better advice that resulted in a 1% p.a. increase in their asset returns, the pool of national savings would be $2 trillion higher in 30 years. This presents a compelling case for the advice industry to invest in fit-for-purpose strategies that cater for a broader client base, in support of greater economic prosperity and a thriving financial advice sector.

Deloitte Access Economics Finance Lead Partner John O’Mahony said that while the ‘big shift’ will transform the competitive landscape of the advice industry, advisers have agency to ready themselves for the future:

“To take advantage of a changing future, advisers need to make choices today that can best service evolving customer needs across the Australian market. Advisers can avoid being edged out in an increasingly competitive sector by adapting and perfecting their unique customer profile, business model, specialised advice capabilities and technology selection. By embracing the megatrends and mapping their practice against the current landscape, advisers can carve themselves a sustaining market position.”

76% of the surveyed Australian financial advisers agree the sector needs to evolve its use of technology to help service a growing client landscape.

Iress CEO Marcus Price said proactive advisers can adapt and improve their practices by harnessing advanced technology and developing an acute awareness of their clients’ changing needs:

“The findings of this research are compelling – despite a number of challenges in the industry over the past few years, advice revenue is forecast to grow substantially over the next five years driven by strong consumer demand. What’s clear though is that advice business models must evolve to capture this demand effectively, as well as adapt to better reflect the breadth of needs from consumers. At Iress, we know that technology and data is at the heart of this and we’re committed to reinvesting in our core software, while exploring emerging technologies, to help drive greater efficiency, scale and relevance across all aspects of advice delivery.

“We’re excited about what the future holds for advice, and look forward to supporting our clients and the broader industry as they step into this new frontier of opportunity.”

Read the report.

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Cameron Williamson has over 25 years’ experience leading finance operations both in Australia and around the world. Most recently, he was at Pendal Group where he spent 15 years as its Chief Financial Officer building out its global business. Prior to this he served as CFO & Company Secretary for Clairvest Group in Canada, as well as holding senior finance roles at Franklin Templeton and CIBC World Markets in Canada and UBS in London.

Mr Williamson played a pivotal role in Pendal’s transformation from a largely domestically-focused fund manager to a global player, during which time it experienced a period of exceptional growth. This involved the acquisitions and associated capital raising of material transactions in the UK and US during his tenure.

The appointment follows a thorough candidate search and evaluation process following the appointment of previous CFO, John Harris, to the role of CEO – Managed Portfolio in April 2023.

Iress’ Group CEO, Marcus Price, said the Iress Board was pleased to have secured a CFO of Mr Williamson’s considerable expertise.

“We are delighted to welcome Cameron to the Iress leadership team at what is a pivotal moment for the company. Cameron is a highly experienced CFO with a strong track record and extensive industry knowledge both in Australia and internationally. His expertise in strong financial management, collaborative approach to leadership and focus on growing shareholder value through corporate transformation will be a great asset to Iress both now and into the future.”

Mr Williamson said, “I am thrilled to be joining Iress at what is an exciting period in its history. I have been impressed with Marcus, as well as the Management team and Board, who have outlined a clear strategy for the next phase in Iress’ growth. I look forward to getting started and am confident my experience and background is well suited to deliver on Iress’ strategic goals.”

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The change forms part of the steps the company is taking to strengthen its position in all markets, drive innovation and help the industry tackle the challenges presented by today’s markets, and follows the appointment of Iress Group CEO Marcus Price in 2022.

Mr Price said: “At the core of Iress’ refreshed strategy is a strong focus on getting closer to our clients, and driving a higher level of accountability and transparency to drive market-leading results in each of our markets. We will do this by transitioning to our new team structure, enabling us to get closer to our client and drive higher performance through end-to-end accountability.

“Our analysis has confirmed that the core of the Iress business is incredibly attractive and exceptionally positioned at the centre of a thriving Australian wealth & trading ecosystem. Our ambition is to refocus on our clients in financial advice, trading & market data and superannuation by reinvesting in our core software and building the next generation of advice software, industry connectivity and data and analytics capabilities.”

“I’m confident Iress’ new organisational structure will strongly position us for our next growth horizon, with a program of clear and deliberate actions aimed at reinvigorating growth and value in our core businesses and  delivering efficiencies that will improve our clients’ experience.”

Refreshed leadership team

Effective from 1 July 2023, Iress’ refreshed leadership team now also includes:

• Harry Mitchell – CEO, Wealth Management
• Jason Hoang – CEO, Trading & Market Data
• Paul Giles – CEO, Superannuation
• John Harris – CEO, Managed Portfolio

Each business line will have full end-to-end accountability of product, technology and support functions to streamline and enhance the client experience.

Additional roles appointed include Ana Smith as Chief Transformation & Strategy Officer, David Hentschke as Chief Innovation Officer and Justin Schmitt as Chief Operating Officer.

The Chief Product Officer role is not part of the new structure – Joydip Das will leave Iress to pursue other opportunities.

Strengthening core and investing for growth

In recognition of the critical role Iress plays in the financial advice, trading and superannuation industries, Iress has announced plans to reinvest in its core software to improve value for clients, while launching a new Innovations division to expand capabilities in future growth areas.

This will include investments in the development of next-generation advice technology to support the growing unmet advice demand in Australia and around the world, the exploration of data and AI opportunities and the continued expansion of Iress’ connectivity capabilities in wealth and trading including Xplan Affinity.

Reducing cost

Iress has announced a 10% headcount reduction reflecting a more efficient and focused organisational structure. Roles targeted for redundancy are not expected to impact on client service and delivery.

MFA & Platforms business divestment process commenced

Iress has also announced it will move forward with divesting its MFA & Platform businesses after determining they are not strategically aligned to the future direction of the company.

There is no impact on the day-to-day operations of clients, and Iress is confident in securing a solution in the best interests of clients and people.

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