New Zealand Professional Investment Services Firm

Forsyth Barr

We are proud to be a New Zealand owned firm, with 21 offices throughout the country and over 300 employees. We assist personal, institutional and corporate clients providing a full range of investment services.

Forsyth Barr is a foundation New Zealand Exchange firm (NZX) and accredited market participant. We have been confirmed by the Financial Markets Authority as a Qualifying Financial Entity (QFE).

Research is the cornerstone of our advice. We have one of New Zealand's leading teams of analysts. Our global affiliations ensure comprehensive research coverage of all major investment markets.

New Zealand Professional Investment Services Firm, Forsyth Barr

Equity Bottom-Up

<h2>NZX<br>ASB Superannuation Master Trust acquisition</h2>
<ul>
<li>NZX has this morning announced the acquisition of ASB’s Superannuation Master Trust through its wholly owned subsidiary Smartshares Limited</li>
<li>The acquisition is for a total cash consideration of NZ$25m funded from a combination of cash on hand and new debt facilities</li>
<li>The acquisition is expected to contribute between NZ$4.0m and NZ$4.3m annually at an EBITDA level</li>
<li>The transaction is expected to be completed in late 2021, early 2022</li>
<li>NZX’s FY21 EBITDA guidance remains unchanged at NZ$32.0m to NZ$35.5m although this will now include a one-off exceptional transaction cost of NZ$1.3m</li>
</ul>
<p><strong>Our view</strong></p>
<p>This appears to be a relatively sensible acquisition, adding to the growing momentum of the Smartshares business seen in recent years. We estimate NZX paid a ~6x EV/EBITDA multiple for the management contract of ASB’s Superannuation Master Trust, which compares to NZX’s current EV/EBITDA of ~14x.</p>

NZX ASB Superannuation Master Trust acquisition

NZX has this morning announced the acquisition of ASB’s Superannuation Master Trust through its wholly owned subsidiary Smartshares Limited
The acquisition is for a total cash consideration of NZ$25m funded from a combination of cash on hand and new debt facilities
The acquisition is expected to contribute between NZ$4.0m and NZ$4.3m annually at an EBITDA level
The transaction is expected to be completed in late 2021, early 2022
NZX’s FY21 EBITDA guidance remains unchanged at NZ$32.0m to NZ$35.5m although this will now include a one-off exceptional transaction cost of NZ$1.3m

Our view
This appears to be a relatively sensible acquisition, adding to the growing momentum of the Smartshares business seen in recent years. We estimate NZX paid a ~6x EV/EBITDA multiple for the management contract of ASB’s Superannuation Master Trust, which compares to NZX’s current EV/EBITDA of ~14x.

NZX: ASB Superannuation Master Trust Acquisition