360 Capital advances bid for under-pressure E&P Financial Group

The embattled wealth management company is in the sights of 360 Capital.

Tony Pitt; CEO of 360 Capital, in their Sydney offices.

Wealth management and advisory company E&P Financial Group, formerly known as Evans Dixon, would be broken up if suitor 360 Capital Group wins control of the $140m company.

The Tony Pitt-led predator has submitted its bidders statement, although it has kept strict conditions relating to a case brought against its former Dixon Advisory arm by the Australian Securities & Investments Commission.

A letter from 360 independent chairman David van Aanholt said that the company’s offer provided compelling strategic benefits and value to E&P shareholders.

E&P shareholders who accept the 360 offer are entitled will receive 0.40 360 shares and cash of 30c per E&P Share.

The ASIC court proceedings against an E&P unit, Dixon Advisory and Superannuation Services, requires that before the end of the offer period, the case is settled for less than $10m.

360 says it has strong record of turning around companies and its own healthy business platform. The company is major property funds manager and is already the largest E&P shareholder with a 19.9 per cent stake.

360 intends to split the funds management division from the wealth and capital markets divisions. It would keep full ownership of the separated funds management division and look to sell 40 per cent to 80 per cent of the wealth and capital markets units.

But the condition relating to the regulatory action appears unlikely to be easily satisfied as it stands.

Mr Pitt said the suitor‘s interest in E&P was “really on the funds management” side and the scheme allow existing staff to take a stake in the wealth management unit.

“That takes the conflict away inherent within [E&P] and really rewards the staff with the work they‘re doing,” he said.

360 may assess the terms of its bid conditions relating to the ASIC bid when it received further information on the court case, he said.

Mr Pitt said the bid was gaining momentum. “Some people have started to accept … as it reduces their exposure to the ASIC case,” he said.

He flagged that 360 would take an open approach in talks with shareholders, and also with potential partners interested in the wealth unit.

“We are always happy to talk to management and we are talking to a number of staff members and a lot of them are shareholders as well,” he said. ”A number of them seeking direction in where the company is going.