US private equity firms looking at mid-tier firms
Mergers and acquisitions within mid-tier funds management, planning and accounting firms are likely to continue with US private equity firms looking for opportunities to buy in to the local market according to an investment banking business.
Chase Corporate Advisory , principal and managing director, Jeff Singh, said the surge in mergers and acquisitions in the mid-tier space was evidence of structural change moving through financial services with the lower Australian dollar, rising equity market and recent rounds of legislative change driving change and lifting interest in the local market participants.
"US private equity firms eager to get a foothold in the Australian financial services sector see real opportunities at the moment, and they are aggressively pursuing an acquisition agenda," Singh said.
He said these forces would continue to change ownership structures in financial services with the funds management space set to change as boutique managers are identified as key players in creating a wider product offering and income base.
"Fund managers know that they must evolve and grow if they are to continue to remain competitive and keep their slice of the investment market. Particularly as the great big pool of superannuation money grows ever larger.
"We are seeing fund managers take steps to identify boutiques which they can incubate and develop, with an eye to improving distribution on and offshore, as well as diversifying their income streams," he said.
Singh said Chase had been involved in a number of recent deals in the funds management and financial planning sectors including the sale of Certitude Global Investments to Ironbark Asset Management this week and the sale of Crowe Horwath to the Findex Group last year and was expecting more this year.
"Chase is one of the few specialists in this area, and as a result we have been overwhelmed by demand for our services. Our pipeline is now in the order of $20 billion in FUA/FUM, something we have never experienced before," he said.
Recommended for you
Platinum Asset Management has put its two closed-end funds under strategic review in a bid to reduce the share price discount to pre-tax NTA and maximise shareholder value.
In the latest Meet the Manager profile, Money Management speaks with Michael Skinner, founder and managing director at Blackwattle Investment Partners.
Perpetual has seen AUM rise 6 per cent in the last quarter but the departure of a longstanding JOHCM fund manager led to outflows of $2.2 billion from his strategy.
Global fixed income fund Bentham Global Opportunities has been added to several major platforms, enabling it to be accessed more easily by financial advisers.
