Tower to divest trustee business

By NZPA

Wednesday 24th July 2002

Australasian financial business Tower Ltd has decided to sell part or all of its personal and corporate trustee business, saying it does not fit with its strategic position.

The personal superannuation, wrap service and portfolio management services are being retained, it said in a statement.

In December Tower launched a new strategy focused on wealth management in Australia, while leveraging off its position in New Zealand.

Chief executive James Boonzaier said diversification had been the foundation of the company's past success.

"However, today's business environment requires a much greater degree of focus, especially for a group of Tower's size, with very much larger competitors. We can no longer be all things to all people and must try to do a few things well in market sectors which are most attractive in terms of growth and profitability."

KPMG corporate finance in Sydney will advise on the divestment. The company said it would begin within the next fortnight and expected to announce the outcome in the first half of October.

Tower also yesterday confirmed that the location of the Investment Administration Centre (IAC) would be Sydney, and that functions currently performed in Adelaide would be moved there over the next 18 months.

Mr Boonzaier will retire at the end of July after 12 years at the head of the company.

Tower chairman Colin Beyer said that in the early 1990s Mr Boonzaier led Tower's expansion into Australia, where Tower now does 70 percent of its business.

The board had started an international search for a replacement. Chief financial officer Keith Taylor will act as chief executive until then.

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