IOOF Holdings has agreed to buy 100% of National Bank of Australia subsidiary MLC Wealth for A$1.4bn (£770m, $1.03bn, €860m).
The agreement follows the strategic decision announced by NAB in 2018 to sell off MLC.
The completion of the M&A deal is expected to occur before the middle of calendar year 2021.
Ross McEwan, NAB chief executive, said: “The sale of MLC will enable NAB to prioritise investment and focus on executing our refreshed strategy of delivering simpler, more streamlined products and processes for our customers and colleagues.
“We have explored a range of transaction options and are confident this sale provides the best outcome for NAB shareholders and for MLC stakeholders. We recognise the specialised nature of wealth management and the opportunity for the MLC business as part of IOOF.
“Consolidation has the potential to deliver significant benefits for clients and members, including scale and reducing costs, complexity and risks. The combined business is expected to be a highly competitive, advice-led retail wealth manager.”
The deal includes MLC’s advice, platforms, superannuation & investments and asset management businesses.
As part of NAB’s ongoing commitment to its customers, the bank will retain legal ownership of MLC’s advice entities, for the purpose of completing advice-related remediation programmes.
Other assets of the advice entities and related employees of the business will be transferred to IOOF as part of the transaction.
MLC’s aligned advisers will be provided with an opportunity to transfer to IOOF’s licences at completion of the deal.
NAB will continue to offer targeted wealth management products and services through JBWere and Nabtrade.
The two firms will also enter into a strategic partnership that will cover a range of products and services, which will include a referral agreement through which NAB customers will have access to financial advice.