Rufus is acknowledged as one of the leading Pan-European transfer agency systems. As a transfer agency system, Rufus tracks the accounts of investors that invest in mutual funds, packaged equities, cash and hedge funds. The Rufus Business charges a fee under a services agreement that includes use of the software and facilities management of servers. Separate fees are charged for professional services. Rufus currently supports over 75 clients across the United Kingdom (UK), Luxembourg and Ireland, with 1,500 funds and more than 6 million
Under the Asset Purchase Agreement, Bravura will acquire the Rufus Business, incorporating all of the software and intellectual property.
Bravura has also entered a five year license agreement with The Bank of New York. Under the agreement, The Bank of New York will continue to be the largest user of Rufus and Bravura will support The Bank of New Yorkâs retail transfer agency business as it develops in the UK, Luxembourg and Ireland.
The deal is Bravuraâs most significant acquisition since the companyâs inception and establishes Bravura as a major participant in the UK wealth management industry in one transaction. The acquisition is consistent with Bravuraâs growth and acquisition strategy in the UK, as outlined in the initial public offering (IPO) prospectus.
The acquisition terms are a Â£19.2m (approximately A$48m) payment on the anticipated completion date in December 2006, with two subsequent payments subject to specified earn out thresholds. The initial payment at completion will be funded using proceeds raised in the recent IPO and drawdown under an A$35m term loan facility provided by BOS International. The acquisition is expected to be immediately positive to be EPS accretive for the year ending 30 June 2007.
In calendar year 2007, Rufus is expected to generate revenues of approximately A$71m. The business comprises over 270 employees, with retention plans agreed for key senior management.
Mr Iain Dunstan, Bravuraâs Managing Director and Chief Executive Officer said, âI am delighted The Bank of New York, one of the worldâs leading financial services institutions has chosen Bravura as a partner. This acquisition gives us scale in the UK market and access to software with features and functionality that can support a broad range of European fund structures.
âBravuraâs acquisition of this business also ensures the Bank and their clients will continue to be supported by specialist software and consulting services. Over time clients will also benefit from enhanced software as we invest in its development.â
Mr Kin Corning, Chief Operating Officer, The Bank of New York said, âWe undertook a thorough strategic review of the business and concluded that the sale of this business to an independent firm focused on the software business was in the best interests of our clients, our employees and the Bank.
âWe believe that the future value and growth of this business will be better achieved as part of a specialist technology organisation.
âOur core competencies are servicing fund structures with a broad array of outsourcing capabilities and administration services in the UK, Luxembourg and Dublin. The sale of software services to Bravura, and their ongoing servicing arrangements, will enable us to retain this focus.â
The transaction is expected to complete in December 2006. Bravura is expected to fully integrate the business over the first six to eight months following completion.
âThe acquisition is an exciting opportunity for Bravura to acquire a significant platform in the UK that will enable us to take advantage of changes to the wealth management industry in the UK, as well as meeting Bravuraâs key strategic objectives. The Bank of New Yorkâs software business also brings with it access to new financial services clients, skilled and experienced staff and complementary applications,â concluded Mr Dunstan.