Perpetual ends Fidelity monogamy
Perpetual Trustees Australia will end its exclusive arrangement with US-based Fidelity Investments to distribute the latter’s international equity funds in Australia after announcing the launch of its own offshore global equities business.
Perpetual has poached four key Bank of Ireland Asset Management (BIAM) staff, who resigned overnight to join Perpetual’s new Dublin-based subsidiary - Perpetual Global Equities (PGE), which will go live next year.
Perpetual Trustees Australia managing director David Deverall describes PGE’s launch as part of a strategy to “develop new growth engines by broadening our asset management footprint”.
Deverall alluded to kick-starting an international equities capability in August, which raised questions as to the group’s relationship with Fidelity.
Fidelity Australia managing director Michael Ohlsson, says the six year arrangement will continue until PGE is launched early next year.
Ohlsson says Fidelity has already been formulating plans to distribute its domestic and international equity funds more broadly to the Australian retail market through intermediaries.
“We intend to use this platform to build a retail presence for international and Australian equities to the intermediary market through our own distribution team," Ohlsson says.
Meanwhile for PGE, Des Sullivan, John Nolan, John Forde, and Richard Kelly all join after working together for 10 years at the core of BIAM’s investment management team, with responsibility for more than $75 billion in global equities.
Reporting to Perpetual’s chief investment officer Emilio Gonzalez, the four Irishmen will be tasked with growing Perpetual’s current $2.2 billion in global equities under management.
“Were taking advantage of the developing trend of global institutional clients to award mandates to specialist global equities managers,” Deverall says.
He projects PGE will be profitable in its second full year of operation, after offsetting approximately $20 million (pre-tax) of start-up costs and operating losses in 2005
“We expect these significant items to be fully offset by the profits derived from the sale of non-strategic assets, with no reduction in 2005 operating profit after tax.
“The 2005 dividend payment of 90 per cent of net profit after tax before goodwill will not be affected by the one-off significant items.”
A share plan comprising Perpetual ordinary shares valued at $28 million is under development, he says, initially to be used as part of the long term remuneration incentives for the four founding asset managers.
Two senior Australia-based Perpetual executives, Rory MacIntyre and Patti Eyers, will also relocate to Dublin to assist in the management of the subsidiary.
Recommended for you
With an advice M&A deal taking around six months to enact, two experts have shared their tips on how buyers and sellers can avoid “deal fatigue” and prevent potential deals from collapsing.
Several financial advisers have been shortlisted in the ninth annual Women in Finance Awards 2025, to be held on 14 November.
Digital advice tools are on the rise, but licensees will need to ensure they still meet adviser obligations or potentially risk a class action if clients lose money from a rogue algorithm.
Shaw and Partners has merged with Sydney wealth manager Kennedy Partners Wealth, while Ord Minnett has hired a private wealth adviser from Morgan Stanley.
