ZB

ANZ in talks to buy Xero rival MYOB

Author
Chris Keall, NZ Herald,
Publish Date
Wed, 13 Jul 2022, 2:20pm
MYOB chief executive Greg Ellis. Photo / File
MYOB chief executive Greg Ellis. Photo / File

ANZ in talks to buy Xero rival MYOB

Author
Chris Keall, NZ Herald,
Publish Date
Wed, 13 Jul 2022, 2:20pm

ANZ says it's in talks to buy MYOB - the accounting software company that operates in the Australian and New Zealand markets, competing with Xero.

Then ASX-listed MYOB was bought by KKR for A$2.4 billion ($2.6b) in 2019 after the US private equity giant bought the shares it did not already own. It then delisted the firm.

KKR wants more than A$4b from an MYOB sale, according to a Bloomberg report.

KKR has also been reported as a possible buyer for Vodafone NZ's celltower network, which is to sell for around $1b. (Bids close on Friday. Yesterday, Spark announced the 70 per cent of its cell tower network for $900m).

ANZ says there is no certainty talks will lead to a deal - and that if it does it will require approvals from the Australian Competition and Consumer Commission and the New Zealand Overseas Investments Office.

Analysts say the deal could allow ANZ to position itself as a one-stop shop for small business financial management.

Melbourne-based MYBO, which today claims around 1.2 million customers, was formed in the 1980s and has grown through acquisition - including two key deals involving New Zealand companies.

One was Auckland-based Banklink, which it bought in June 2013 for $136m from founders Derek Jones, Malcolm MacDonald and Stephen Agnew.

The other was a A$224m deal in 2004 to acquire Solution 6 - which had recently merged with Auckland online accounting pioneer Exonet, co-founded by Maurice Bryham and Satellite Spies frontman Mark Loveys.

Banklink provided crucial automated bankfeed capability, while Exonet brought cloud smarts.

MYOB had A$502m in revenue in the year to December 31, according to a regulatory filing, and made a A$104m net loss after, pinned on a capital restructure.

The company had annual revenue of A$445m and A$190m in underlying ebitda before KKR took it private in May 2019.

ANZ shares were down 0.93 per cent to A$22.49 in early ASX trading.

Xero shares were up 1.17 per cent to A$85.31 (for a A$12.76b market cap).

The ASX200 was trading down 0.01 per cent.