The BT Investment Management Ltd (ASX: BTT) share price is down 7% following a sell-down by its former strategic owner, Westpac Banking Corp (ASX: WBC).
BTT versus WBC share price
What happened?
Over the past five years, Westpac's strategic holding in BT Investment Management (BTIM), one of Australia's leading wealth management businesses, has paid dividends.
However, the increasing regulatory headache and pressure on banks to divest their wealth management arms appear to have led to a sell-down by Australia's second-largest banking group.
Yesterday, Westpac announced it would sell 60 million shares, worth more than $615 million or 19% of BTIM, to institutional investors. The sale price was a 10% discount to the 30-day average.
Brad Cooper, CEO of BT Financial Group said, "with the successful diversification of BTIM's business outside Australia and BT Financial Group's strategic focus on providing wealth solutions, including through our market leading Panorama platform, Westpac no longer needs to retain our shareholding in BTIM."
Nonetheless, the bank retains a 9.8% stake in BTIM. However, it could be sold once its voluntary escrow period finishes in May 2018.
"The sale of shares by Westpac will improve the liquidity of the trading in our shares and broaden the register of shareholders." BTIM Chairman, James Evans, said.
Foolish Takeaway
As can be seen above, BT Investment Management shares have been a very strong performer over recent years, as global markets staged a big recovery from the global financial crisis (GFC) of 2009. While I'm not a buyer of BT shares today, I have them on my watchlist.
