Pacific Current Group (PAC) has used its annual general meeting (AGM) to detail its long-term growth plans amid a period of multiple divestments.
The firm previously described FY24 as a “transformational” time for the business as it created a lower cost structure for the business.
PAC sold three of its assets to GQG Partners – which previously made an unsuccessful bid to acquire the whole firm – in Avante, Cordillera and Proterra for US$71.2 million. It also sold its interest in Carlisle to alternative asset manager Abacus Life in July and divested Victory Park Capital to asset manager Janus Henderson in August.
At its AGM on 15 November, it detailed its long-term growth plans targeting opportunities among its current boutique partners where there is potential to accelerate growth and other new investment opportunities.
It also has “significant capital” to invest in accretive opportunities on an opportunistic basis. As of 30 June, PAC said it has $313 million in surplus cash which will be used for share buybacks, capital returns, dividends and growth investment.
PAC already announced earlier this year that it plans to enact an off-market share buyback which can be as high as $300 million and is due to take place in late 2024 or early 2025.
Speaking at the AGM, chair Tony Robinson updated shareholders on the progress of this and confirmed their approval of the plan.
“This period of change is anticipated to culminate with a share buyback, with the company planning to conduct an off-market equal access share buyback of up to $300 million of surplus capital, subject to shareholder approval at an extraordinary general meeting (EGM). The planning process is ongoing and shareholders will be provided with further information in due course, but we are now expecting to release the notice of meeting for the relevant EGM over the next month.
“Major shareholders, which own approximately 45 per cent of ordinary shares on issue, have all confirmed that they are supportive of the proposed off-market buyback offer being conducted. None of these shareholders have provided any indications about their intentions regarding participation in the buyback if it’s approved by shareholders.”
Its remaining boutiques in the portfolio post-divestment are expected to generate meaningful cash flow, and some of this will be available for reinvestment via balance sheet investment capital, purchase of secondary selldowns from boutique shareholders, and working capital to fund business growth.
In its latest funds under management update, PAC said only one of its eight boutiques saw outflows in the three months to 30 September. Funds managed by its boutique asset managers declined from $42.5 billion to $41.5 billion in the September quarter, driven by a 1.4 per cent decrease at its Australian private markets manager Roc Partners where FUM declined from $8.54 billion to $8.42 billion.
The remainder of Pacific Current boutique managers – Banner Oak, Carlisle, Pennybacker, Victory Park, Aether, Astarte and EAM – are based in the US.
Finally, PAC seeks to optimise organisational effectiveness by bedding down a changed organisation structure and decision-making processes, which had been implemented during FY24.
