Merger Mania

Copy of Will lockdown see a decline in face-to-face skills

Yesterday was just another day in lockdown and just another day for merger talk announcements. The Heritage Building Society has decided it’s time to build a critical mass and merge with a small peoples bank not many people have heard of.

The customary statements followed with the terms:
– Non-binding discussions 
– Board and shareholder approval 
– Multiple existing synergies 
– Third-party importance 

In reality, these smaller organisations understand that if they don’t merge with other similar-sized organisations they will become a target. For those of us who have been a part of “a merger,“ we all know that invariably one party is the buyer and one party is the seller. Takeovers often get disguised as mergers when in fact a takeover better describes the transaction.

As the big behemoth institutions look for significant growth takeovers and mergers are top of the agenda.
In the aggregator space, it’s an identical situation a proposed “merger“ between the two largest aggregators bubbles away behind the scenes.

The big question is what’s better for brokers: Large ASX listed aggregators or independently owned smaller personal aggregators.

Likewise is it better for the broker community to deal with smaller nimble customer focussed entities or massive organisations that yearn for absolute control of the Australian mortgage market.

I will let you be the judge…