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Heightened legislative risk slowing demand for corporate super fund sales
An increased legislative risk within the financial services sector of late is impacting adversely on the demand for sales of corporate super funds, according to Kenyon Prendeville broker Steve Prendeville.
"Corporate super at this stage is the only area where we have seen any decline in price and that's solely due to expected legislative changes to super laws and also the recent announcement of [Investment and Financial Services Association's] draft super charter.
"At this earlier stage we cannot say if sales have been specifically impacted by last week’s Federal Government agreement to allow super funds to provide intra-fund advice."
On the other hand, Prendeville said the increased legislative risk has had no adverse affect on either the demand for advice firms or their sale price.
"We haven't seen any price [difference] for commission-only or fee-for-service advice firms over the past 12 months, and certainly over the last three months, arising from the legislative risk that is now in the market.
"At this stage legislative risk is not being built into any valuations of advice businesses for sale, which suggests advice firms see demand for advice continuing," he said.
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