BlackRock overhauls Australian equities business

BlackRock has confirmed plans to “reposition” its fundamental equities business in Australia, informed by an internal review.

 The new strategy — which purportedly aimed to align the firm’s offering with evolving customer expectations — involved an overhaul of the BlackRock High Conviction Australian Equity Fund.

This includes the closure of the BlackRock High Conviction Australian Long Short Fund and the BlackRock High Conviction Australian Future Companies Fund.

To facilitate the transition, BlackRock had entered into a binding memorandum of understanding (MoU) with ASX-listed Pendal Group — recently acquired by Perpetual Limited.

Pendal Group had been tasked with working alongside BlackRock’s global manager research function within Multi-Asset Strategies and Solutions (MASS) to align the BlackRock High Conviction Australian Equity Fund with its ‘Focus’ strategy.

“Existing clients in the fund will benefit from a broader Australian equities exposure, with a similar high-conviction approach, managed by a well-resourced team of 19 investors that have a long-standing performance track record, and received the highest ratings available from Morningstar, Zenith and Lonsec,” a BlackRock spokesperson told Money Management.

In remodelling its Australian equities business, BlackRock committed to maintaining a “core concentrated portfolio”, which was benchmarked to the ASX 300 index - tipped to provide clients with “greater diversifying exposures”.

“The evolved product offering will also take into account scale and volatility considerations that are in the best interest of unitholders,” the spokesperson added.
 
The repositioning of BlackRock’s Australian equities business comes amid reports of a global company overhaul.

A source told Reuters that the changes had impacted approximately 500 jobs, representing just under 3% of BlackRock’s global workforce.

The changes were reportedly in response to significant US market volatility over the course of 2022.