Challenger Financial Services will be able to offer its clients access to international securities after acquiring a 25 per cent stake in Five Oceans Asset Management.
Five Oceans is a recently formed boutique manager concentrating on investments in international equities with a bias toward absolute return offerings.
The partnership with Five Oceans represents Challenger’s initial effort to offer global equity opportunities for its clients. It reinforces Challenger’s tactic to form strong alliances with outside business partners and follows its recent strategic alignment with Kinetic Investment Partners to strengthen its small companies coverage.
Under the arrangement, Challenger will provide Five Oceans with support services including portfolio management, pricing services, administration, dealing, and registry. Challenger will also handle the distribution for the boutique manager in Australia and New Zealand.
Challenger chief executive, wealth management, Chris Cuffe said: “In Australia the international retail equity market is dominated by just a handful of asset managers. We believe this concentration provides a new entrant like Five Oceans, with its stronger focus on absolute returns, a significant opportunity to gain market share.”
Five Oceans’ main product will constitute an international stock portfolio containing 30 to 50 shares selected using a bottom up method. Former head of international equities with BT Funds Management Chris Selth will manage the portfolio.
Five Oceans chief executive Ross Youngman said: “The alliance with Challenger will allow us to develop an asset management business with all the hallmarks of a boutique while providing the infrastructure support of a large company.”