(pictured: David Orford)

Financial Synergy, arguably the leading superannuation systems company in Australia, is for sale. David Orford, who founded the firm in Melbourne in 1978 as an actuarial business, has appointed an investment bank to advise on a possible transaction.

While, in theory, the possible sale of Financial Synergy should not impact on the proposed sale of Pillar Administration by the NSW Government, it has already muddied the waters in discussions.

Potential buyers of Pillar, of which there is only a handful, are said to be concerned to know who is likely to be the eventual owner of Pillar’s software outsource provider. Pillar appointed Financial Synergy as its third-party administrator last year, using the firm’s Acurity solution. It is the largest such deal for Financial Synergy.

Meantime, Financial Synergy has now appointed the boutique investment bank Canterbury Partners, also based in Melbourne, as its advisor to the possible sale of its business.

Financial Synergy has 120 employees in Melbourne, Sydney and Brisbane, as well as some in Pillar’s Wollongong office. It has about 40 financial services clients, which total more than four million member superannuation accounts. Funds under administration, as of last year, total $250 billion.

Pillar’s main clients are the two big NSW Government funds, First State Super and Sate Super (STC). The Link Group, which is the biggest third-party super admin company, is considered the most likely buyer of Pillar if the NSW Government goes through with a sale. But about 25-30 per cent of the APRA-regulated super admin market is managed by funds internally. Most of these are industry or public sector funds.

Until recently it was rumoured that Tech Mahindra, a big global systems company, was a likely buyer of Financial Synergy.

Financial Synergy this year signed its largest-ever contract, a deal with the South Australian industry fund Statewide Super, to provide “software as a service” for Acurity with the fund.