Pengana ventures into small caps

Pengana Capital will announce the launch of a new small companies division early next week, as the boutique fund manager continues its strategy of adding specialist offerings to its existing investment suite.

The details of two specialist small cap portfolio managers will be announced on Monday ahead of a scheduled launch for the new venture by the end of October.

The new business will sit alongside Pengana’s existing investment divisions, which include property, hedge funds and a listed investment company.

According to Pengana chief executive Russel Pillemer, the fledgling business division will target advisers when it rolls out a single fund into the retail market soon after launching. The fund will be capped at $300 million.

“We may have one or two institutional investors but by and large we will be open to retail investors,” Pillemer says.

The move comes despite Pengana Holdings — Pengana’s parent — calling off capital raising talks with a subsidiary of prominent investor Robert Whyte’s Audant Investments in late September.

The proposed arrangement was for Audant aligned Gladiator HFI to take a 35 per cent stake in Pengana Holdings through the issue of new shares.

At the time Pillemer said despite the deal falling through, the investment management arm still had access to funds for growth purposes.

“We’ve always said that we would consider bringing groups in that offer an opportunity for us to add value to investors, and in this case from a market perspective there is also a strong demand for small caps out there,” Pillemer says.