Colonial First State Investments has entered the next stage of its restructure, registering several ...
Colonial First State Investments has entered the next stage of its restructure, registering several funds for sale in Europe and dropping the word 'Colonial' from the company name, writes Dylan Emery.
The acquisitive company is looking for managers to boost its weak UK and European offerings to support its sales in Europe. The firm's Oeic range will be registered in Germany and Austria at first, followed by France, Italy and Sweden. Holland and Spain, to which the company already sells via fund of funds vehicles, will also be targeted. Registration in Switzerland has already been applied for, although this is expected to take up to a year to secure.
The company has 17 sub-funds in its Oeic and hopes to start selling the first batch of funds into Europe in Q4 of this year. Stuart Paul, CIO, has been reforming the investment process. The poaching of management teams has not been ruled out and First State certainly has the financial clout to do so, with the backing of its parent company Commonwealth Bank of Australia.
First State also has plans to launch a purely offshore range of funds. The group already has a Dublin range run as part of its Singapore distribution, although no plans to integrate it have been indicated.
First State intends to use its Avantios online valuation and transaction platform, used by its Australian parent company, to increase its presence in Europe. Negotiations with third-party distributors to use this platform are underway.
However, this will not be totally straightforward, according to head of marketing Phil Jefferson: 'The UK is the laggard of the world on the IT level,' he said. 'It is behind the EU by a couple of years and well behind the US and Australia. The problem is the distribution network ' not all of the product providers can transact online. And at that stage STP breaks down for everyone.'
First State's entire business model is distribution via advisers, fund supermarkets and to institutions. Of the £6bn under management, 15% is institutional. The company has a US distribution through Babson-Stewart Ivory International, a joint venture with investment managers David L Babson. Last year, star emerging markets manager Angus Tulloch secured a $100m mandate from a US institution. This will be increased this year to $200m.
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