In a bold move to drive the business from an electronic platform, PSG Investment Services - a division of the JSE-listed PSG Group - has restructured its business and acquired full ownership of PSG Online in a transaction valued at R45-million.
This acquisition of PSG Online is funded with the issue of PSG Group shares over a five-year time period, and is effective as from January 1, 2000.
The newly structured PSG Online Securities operation now has more than 17000 clients and R2,5-billion assets under administration.
In terms of the restructuring, a new division - E-nabling Solutions - has been established to drive the development of all new electronic business units within the PSG Group, as well as the content supplied to online users. The current PSG Online website will keep its name and grow its content and services under the management of this team, led by joint MDs Diedrich Schutte and Andre Maartens. "We intend to substantially expand our e-commerce services to include a full range of investment products," says Jaap du Toit, CEO of PSG Investment Services.
"Building on the success of PSG Online as an electronic stockbroking service, new initiatives will include unit trusts, wrap funds and direct access for clients to data related to their investments."
On an operations level, the online and traditional stockbroking activities will merge, under the name of PSG Online Securities, with the resulting synergies and cost savings. Management of these joint securities services will resort under joint MDs. Emil Linde will be responsible for branches and new business development, while Johnny Macrides will remain in charge of the clearing, settlement and custodianship functions as well as the fulfilling of the important role of compliance officer to the JSE.
"The biggest challenge in setting up e-business ventures is building virtual communities. This is where we believe that we have a strategic advantage in that we already have access to more than 70 000 potential PSG high net worth clients," adds du Toit.
"The other area of strategic advantage is in that we are a small, dynamic and relatively new investment services player with an established electronic platform. This means that we can transform our business model quickly in line with the new trend toward electronic delivery of financial products.
"This will be done in the context of the unique South African market needs, which include personal interaction and education on investment options."
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