PERPETUAL Investments has delayed listing two of its wholesale funds on Sovereign’s AEGIS wrap account following a procedural glitch.
The Australian based fund manager had intended to list its flagship funds – the Fidelity Perpetual Wholesale International Fund and the Perpetual Wholesale Industrial Fund – on AEGIS as early as this month.
However, Perpetual national account executive Damian Crowley says that date has now been put back, as the company seeks to amend the funds’ constitutions.
“The only complication is that AEGIS requires managers to offer a buy-back option not redemption,” Crowley says.
“However, after the introduction of the Managed Investments Act in Australia, we deleted the buy-back option from the funds’ constitutions.”
He says the company is seeking legal advice about the best way to re-insert a buy-back option into the constitutions.
“Obviously we don’t want it to go to the unit-holders for a vote. It shouldn’t be too difficult to add the buy-back clause. It’s just adding another option and won’t impact on existing Australian clients,” Crowley says.
AEGIS demands managers include a unit buy-back provision, as it offers a tax advantage in New Zealand.
Crowley says other Australian fund managers who wish to offer products in New Zealand will face similar problems.
Perpetual has been establishing itself in the New Zealand market following the release of the Securities Commission policy allowing Australian fund managers to offer products without the need to create a separate prospectus.
Crowley says Perpetual is committed to listing its products on the AEGIS wrap account.
“I’m confident we will work through this issue soon,” he says.
ASB Bank has announced plans to merge the life businesses of Sovereign and Colonial New Zealand creating the country’s largest life company with $460 million of annual premium income.
The move follows the Commonwealth Bank of Australia (CBA) buy out of the final 25 per cent of ASB from the ASB Community Trust.
ASB has owned Sovereign for over two years, while its parent company, CBA recently took over Colonial.
ASB general manager marketing, Barbara Chapman, says the buy out cleared the way for the integration of the Colonial and Sovereign life companies.
“With the Trust owning 25 per cent a merger was too complex but now the process is under way,” Chapman says.
She says the new company will be based in Auckland and will be headed up by Sovereign chief, Ian Hendry.
However, the company will retain a strong presence in Wellington where Colonial is based.
Colonial head, David May, was offered a job in the new organisation but has chosen to “pursue other interests”.
Chapman says while there is some uncertainty amongst the staff of both companies, ASB is committed to growing its business.
“The key is retaining people with knowledge, it is critical to hang on to them,” Chapman says.
She says only one brand will remain in New Zealand and ASB is currently researching the relative strengths of both the Sovereign and Colonial names.
“However, we’re waiting on CBA in Australia to decide what to do with all the brands it now owns.”
She says the entire product range of Sovereign and Colonial is also being reviewed with rationalisation a likely result.
However, Chapman says the funds management side of Colonial First State will not be integrated into the ASB group.
“Colonial First State New Zealand will be reporting directly to CBA in Australia,” Chapman says.
RAAM boosts team
ROTHSCHILD Australia Asset Management (RAAM) has added to its New Zealand team as part of the drive to re-establish the brand.
Head of RAAM adviser services Stephen Karrasch says the appointment of Bronwyn McGinity as manager adviser services to New Zealand, demonstrates the company’s commitment to growing the market.
McGinity, who was previously part of the Rothschild’s New Zealand team before the company withdrew from the market in 1998, will be based in Sydney.
However, Neville Giles of FMS Partners will continue as the Rothschild representative in New Zealand.
Giles has been representing Rothschild in New Zealand for over a year, as the company re-entered the market but adopted a policy of servicing its clients from Australia.
Karrasch says the growth of wrap account and master trusts and the alliance with Putnam Investments has been positive for Rothschild’s business in New Zealand.
“We intend to offer sustained support for financial advisers and other intermediaries, and believe our business will continue to benefit from efficiencies of investment in technology and e-commerce,” he says.
Mac goes shopping
MACQUARIE CountryWide Management has bought a portfolio of 13 supermarket based properties in New Zealand for NZ$83.5 million.
Macquarie has purchased the properties through Macquarie CountryWide Trust and will settle 12 of the properties by September 30, with the remaining one being subject to right of first refusal by a third party.
The acquisition is to be funded by a combination of a NZ$60 million placement and debt facilities.
Chief executive of Macquarie CountryWide Management Kylie Rampa says New Zealand offered a number of advantages for the trust.
She says the similarity of demographics, geographic proximity and retail trends in line with Australia make New Zealand an attractive proposition.
“Our primary focus remains in Australia where the scope for further acquisitions is significant,” Rampa says.
“However, we will continue to look for further opportunities to consolidate our position in New Zealand.”
Macquarie CountryWide intends to limit investment in New Zealand to 15 per cent of the total portfolio value. The New Zealand investment stands at 11 per cent of Macquarie CountryWide’s assets.
