Sequoia Sells InterPrac for $50k to Dodge $7.5M Write-Down and Adviser Exodus

Sequoia Financial Group divests InterPrac to Conquest Investment Partners

Sequoia Financial Group (ASX: SEQ) has signed a Share Sale Agreement to sell 100% of InterPrac Financial Planning to Conquest Investment Partners for $50,000. The Sequoia Financial Group InterPrac Sale follows a strategic review of the Licensee Services division announced on 17 March 2026, which identified structural, regulatory, and commercial challenges threatening the business’s long-term viability.

The transaction removes Sequoia’s exposure to ongoing regulatory uncertainty and unquantifiable contingent liabilities stemming from the Shield Master Fund and First Guardian Master Fund failures. Sequoia has written off $4.7 million in intangible assets related to InterPrac in the February 2026 management accounts, principally reflecting adviser resignations that eroded the customer list value.

If the sale does not complete, the board expects to write down InterPrac’s value by a further $7.5 million, representing the cash and investment assets remaining within the business. The transaction requires ASX review under Listing Rules 11.1 and 11.2, and may require shareholder approval at a General Meeting.

Why divest InterPrac? The structural challenges explained

InterPrac operates as an Australian Financial Services Licence (AFSL) licensee, providing compliance infrastructure and regulatory oversight for financial advisers who operate as authorised representatives under its licence. This model allows individual advisers to serve clients without holding their own AFSL, relying instead on InterPrac’s licence and supervision.

The business faced severe operational disruption following the collapse of the Shield Master Fund and First Guardian Master Fund investment products. Despite most InterPrac advisers having no involvement with these funds, platform providers withdrew or restricted services to all advisers operating under the InterPrac AFSL. Platform access matters because advisers require relationships with investment platforms (such as superannuation and managed fund providers) to implement client recommendations effectively.

Over the past six months, InterPrac has operated in an increasingly adverse environment characterised by ongoing industry scrutiny, uncertainty over remediation responsibility across the advice value chain, and material decline in authorised representative numbers. More than 200 remaining advisers under InterPrac’s AFSL lost platform access for new business despite meeting compliance standards and having no connection to the fund failures.

The business transitioned from profitability to loss-making as platform withdrawals accelerated adviser resignations. Under the current resignation rate, Sequoia expects adviser numbers to reduce to nil within 12 months. A further platform removed adviser access to new business this week, compounding the commercial pressure.

InterPrac engaged extensively with stakeholders during this period, advocating for whole-of-system remediation reflecting the roles of all participants in the distribution chain, and calling for APRA-regulated superannuation funds to remediate clients under Operational Risk Financial Requirement standards. Whilst some clients received remediation from Macquarie and Netwealth, these same platforms subsequently removed access for remaining InterPrac advisers who were not involved in recommending Shield or First Guardian.

InterPrac’s balance sheet at transfer

InterPrac has not paid dividends for more than 2 years as the Shield and First Guardian failures became known, allowing the balance sheet to remain strong for potential remediation, legal costs, and ongoing business operations. The business transfers with substantial assets and active professional indemnity coverage, positioning it to manage remediation obligations under new ownership.

Key insurance details:

• InterPrac maintains current professional indemnity (PI) insurance with $20 million coverage
• Notice of both Shield and First Guardian failures was provided to the insurer in the 2023/24 policy year
• Sequoia believes the PI policy provides capacity to respond to and defend InterPrac’s reasonable share of remediation offered to members of APRA-regulated superannuation funds
• Exposure was entirely within APRA-regulated super funds, not on a direct basis or within self-managed super fund accounts

The new owner may elect to withdraw or accelerate Australian Financial Complaints Authority (AFCA) determinations and seek to mediate with ASIC regarding separate actions, as Sequoia had planned to do. Under the Sale Agreement, InterPrac will access support from Acacia Compliance Services Pty Ltd under a Transitional Services Agreement, providing ongoing administrative and compliance services on an arm’s length fee basis for at least 6 months.

What this means for Sequoia shareholders

The board determined that selling InterPrac represents the most appropriate action for all parties, including Sequoia shareholders, having regard to four key considerations that crystallise the investment rationale:

1. Removes disproportionate risk relative to InterPrac’s reduced scale and earning capacity following platform withdrawals and adviser attrition
2. Eliminates exposure to unquantifiable contingent liabilities in respect of open AFCA proceedings and associated legal costs, which are difficult to quantify with certainty
3. Stops the adviser exodus that would reduce revenue to nil within 12 months under current resignation rates, accelerated by this week’s platform access removal
4. Ensures InterPrac remains appropriately resourced to address ongoing remediation matters without draining Sequoia capital

Sequoia has already absorbed the $4.7 million intangible asset write-off in February 2026 management accounts. By completing this sale, the company avoids a further $7.5 million write-down that would occur if the transaction fails. The disposal removes financial and regulatory uncertainty from Sequoia’s balance sheet, allowing management to refocus capital allocation on core growth businesses.

The board notes that under new ownership, InterPrac is more likely to recommence engagement with platforms and stem adviser losses, providing greater ability to fund and manage ongoing obligations of reasonable remediation. This outcome serves the interests of stakeholders, including clients and AFCA complainants, as fresh ownership provides InterPrac with access to capital and risk management protections that would not be available under continued Sequoia ownership.

Sequoia’s remaining operations and growth focus

Following the write-off, Sequoia retains diversified revenue streams across advice, legal documents, administration, and media segments. The company will focus on its remaining operations and growth prospects:

• Sequoia Wealth Management AFSL: Delivers bespoke wholesale advice for high-net-worth and sophisticated clients
• Salaried advice businesses: Sequoia Corporate Finance, Sequoia Family Office, Sequoia Asset Management, and Acacia Financial Advice (formerly Sequoia Financial Advice) offer diversified finance solutions across corporate finance, family office, mortgage and finance, high-net-worth, and traditional personal advice
• Legal document businesses: Panthercorp, Constitute, NTAA Corporate, Castle Corp, and Docscentre Legal currently service over 10% of Australian accounting firms, adding value for advisers, accountants, and lawyers
• Superannuation administration business: Ongoing administration services supporting retirement savings
• Sequoia media business: Financial news sites and associated capabilities for ASX-listed companies
• Sage Capital Group: Sequoia owns 100% of Sage Capital Group, which maintains an investment portfolio of ASX-listed securities
• Strategic investments: Non-controlling stakes of around 20% in Morrison Securities Pty Ltd and Euree Asset Management Pty Ltd

The company will continue development of its Asia-Pacific strategy to expand salaried advice and corporate finance businesses, sharpening focus on profitable segments with structural growth potential.

New ownership positioned to stabilise InterPrac

Conquest Investment Partners brings extensive financial services experience across licensing, legal services, funds management, and adviser support. Managing Director John Pereira has founded and led multiple funds management and advisory businesses, including India Equities Fund and Olympus Funds Management, and operated at CEO and board level across investment, asset management, and corporate advisory firms.

Justin Harding, Executive and current sole Director of InterPrac, will remain with the business post-sale, ensuring continuity for advisers and clients. As part of this transaction, Harding will leave employment at Sequoia subsidiary Acacia Compliance Services Pty Ltd, where he has been employed for the past two years.

John Pereira, Chief Executive Officer of Conquest Investment Partners

“We are pleased to be acquiring InterPrac and see a strong opportunity to build on its longstanding presence in the financial advice sector. We look forward to working closely with advisers, platform providers, and broader industry participants as we support the next phase of the business under new ownership. Our focus will be on stability, engagement and delivering a sustainable path forward for all stakeholders.”

Pereira confirmed that Harding’s experience and deep understanding of the business will be invaluable during the ownership transition, with both executives working together from their Melbourne base to support advisers and strengthen industry relationships. Fresh ownership may re-engage platforms that withdrew services under Sequoia ownership, potentially stabilising adviser numbers and providing better outcomes for complainants and stakeholders.

Conditions and next steps

The transaction remains subject to several conditions precedent that protect both parties’ interests:

• No material adverse change occurring in relation to InterPrac before completion of the sale
• Inter-company loans owing by InterPrac to the Sequoia group being settled or released before completion
• Transitional Services Agreement between InterPrac and Acacia Compliance Services being executed and initial fees paid
• ASX determination that Sequoia is not required to meet the requirements of chapters 1 and 2 of the Listing Rules

Sequoia will engage with ASX to determine applicability of Listing Rules 11.1 and 11.2. Should shareholder approval be required, the company will convene a General Meeting and provide a Notice of Meeting and Explanatory Memorandum setting out the material terms of the transaction for shareholder consideration.

The transaction structure ensures orderly separation whilst maintaining operational continuity for InterPrac advisers and clients during the ownership transition.

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