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Misys IFA flotation may bring in up to £700m

Misys will float its IFA business within two years and realign its five networks into separate divisions reflecting different distribution strat-egies once the outcome of the FSA&#39s review of polarisation is determined.

The flotation of the 7,500 adviser mega-network could raise up to £700m and would satisfy analysts who want Misys to concentrate on its core business as a software provider.

Misys will not say whether it will demerge or offer shares to the market direct. Demerger would see existing shareholders, including Legal & General, Aegon, Fidelity, Prudential subsidiary M&G and NU subsidiary Morley, first in line to take stakes

Misys&#39 investment banker Cazenove has valued the flotation at between £215m and £276m, based on the current regulatory structure but other City analysts say the IFA business could be worth between £400m-£700m after CP121.

Misys plans to launch a programme of incentives to retain members, including retirement buyout options and share offers on flotation.

Misys&#39 share price surged by 21 per cent from 181p to 210p following the announcement.

Misys chairman Kevin Lomax says: “The IFA business is a valuable entity. Misys&#39 shareholders will never get proper value while it stays in the company.”

Brewin Dolphin analyst Ian Macarthur says: “Misys advisers&#39 productivity is low. What would be interesting is if Misys had people going in there to raise the game – people who are more commercially aware. If they had a Keith Carby going in, it would be interesting.”

•Misys flotation, p2&9

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