Rothschild Australia Asset Management(RAAM) has announced that it is seeking equity partners as part of a bid to expand its presence and drive growth in the Australian market.
RAAM chief executive Peter Martin made the announcement yesterday and says at present the group is still seeking partners, and could not state who the new stakeholder may be or if this would have an affect on the Rothschild brand in Australia.
He was also unable to supply further details as to the exact nature of any future relationship since he says it would depend on the level of equity taken and the culture of any equity partners.
“It is too early to know the wash from all this but it could range from a minor to major stake but at this stage, the Rothschild family are seeking expressions of interests. However, any possible partners must have global strength, access to technology and scale, that is, in terms of financial muscle,” Martin says.
According to Martin, RAAM is seeking new stakeholders because the Rothschild family – the current stakeholders – felt that to drive the business forward it was necessary to source outside funding and expertise.
“This is coming off the back of building our capabilities through alliances, and to compete we have to offer high quality local and global capabilities. The Rothschild family recognised that we were not able to compete and the next step in being a tier one player was with more financial muscle. The reality is, the hurdles get higher as we go forward,” Martin says.
The equity stake will not have any impact outside the RAAM business and Martin says the group hopes to have a shortlist of potential partners decided upon by the Rothschild family and local management, by the end of January.
If this deadline is met, Martin says due diligence processes will begin in February with a final sign off date set for the middle of 2002.
He did state that as part of the ongoing relationship with Putnam the two groups were in discussion, but RAAM would look across a range of local and offshore managers.
However, Martin says RAAM is not looking at the three groups recently nominated for new strategic alliances whereby it will outsource its global fixed interest, global listed property and global multi-manager private equity portfolios.
Ratings house Assirt has also reviewed the news of the equity stake offering and says the move would be beneficial and has not altered any sector or product ratings.
