Perpetual Guardian (PG) is set to emerge with a broader retail fund offering after its surprise purchase of the slimmed-downed Castle Point boutique last week.
Patrick Gamble, PG chief, said the estate planning specialist would likely repackage some of its in-house wholesale and discretionary investment management service (DIMS) strategies as retail funds under its newly acquired managed investment scheme (MIS) licence.
Gamble said the firm currently offered a suite of “vanilla” diversified funds and some specialist strategies to its mainly trust client base in wholesale or DIMS form with about $2.5 billion under management.
He said the PG strategies are a mixture of in-house managed and outsourced funds overseen by chief investment officer, Tim Chesterfield.
Under a now expanded ambit, Chesterfield would also be responsible for the Castle Point funds, which will continue under the same brand and portfolio management staff for now.
The CIO has spent almost 7 years at PG in its various guises after joining the firm in 2015 from the-then ASX-listed Australian Wealth Management (AWM).
Prior to AWM he served as portfolio manager for AMP Capital in Australia following a long career in senior investment roles across the Tasman and in the UK.
At AWM he served alongside then-head of the business, Andrew Barnes, who is also the founder and major shareholder of PG.
Castle Point comes with 13 employees, Gamble said, including founders Richard Stubbs, Stephen Bennie, James Young and Gordon Sims.
The hurried Castle Point sale came after the loss of an anchor institutional mandate with BNZ, understood to be about $300 million, earlier this year.
Stubbs et al were minority shareholders with largest owner located in the UK. Castle Point recorded a small loss for the 12 months to March 31 last year on revenue of over $4 million; for the 2021/22 fiscal year, the manager booked a profit of more than $900,000 on income of $7.2 million plus including close to $3 million of performance fees.
According to Gamble, the remaining Castle Point funds are split roughly equal between wholesale and retail. The manager, launched in 2013 from the remains of the-then Tower investment team, Castle Point offers three retail funds: Trans-Tasman; Ranger; and, the multi-manager 5Oceans.
Figures from investment consultancy firm, Melville Jessup Weaver (MJW), show the $80 million Castle Point Trans-Tasman fund has the best 10-year record to the end of March among its cohort of local equity strategies despite recent underperformance. The Ranger and 5Ocean funds manage about $130 million and $140 million, respectively, at the end of March, the MJW report shows.
Gamble said PG would look to shore-up Castle Point performance and reassure existing clients, which includes retail-advised as well as wholesale mandates supported by consultants such as EriksensGlobal.
He said while the group might offer Castle Point funds via its recently expanded network of financial advisers, the PG “fiduciary clients” tend to “need reasonably low-risk” investments.
PG has about a dozen advisers after acquiring the Trustees Executors wealth advisory division in February.
However, Gamble said the Castle Point licence would enable PG to open its funds to the retail market and further potential distribution through third-party financial advisers.
He said the group had no other buy-out targets on the immediate horizon but it would always consider opportunities as they arise.
Barnes established PG as part of a trustee company buying spree in NZ after leaving AWM. His Complectus group bundled up several trustee firms including Guardian Trust, which was spun off in 2021 to the Hong Kong-based, Tricor – a global ‘corporate services platform’.
Tricor was owned by the UK private equity firm, Permira – recently touted as a potential buyer of the TA Associates one-third stake in Fisher Funds – until 2022 when it sold the group to Baring Private Equity Asia.