GQG details FUM post acquisition of PAC affiliates

GQG Partners has reported a decline in funds under management in April following the acquisition of three Pacific Current Group (PAC) affiliates.

In a monthly ASX update, the US asset manager said it had experienced net inflows for the year to date period of US$6.3 billion ($9.5 billion). 

Assets in its international equity division remained flat during the month at US$55.8 billion, its largest asset class. 

Declines in FUM were seen in its US equity and global equity divisions, with global equity declining by 4.6 per cent from US$36.7 billion to US$35 billion while US equity reduced from US$11.9 billion to US$11.6 billion, a decline of 2.5 per cent. 

VIEW ALL

View all

However, its emerging market equity division rose by 1.5 per cent from US$39 billion to US$39.6 billion. 

In Australia, the firm offers three funds: Global Equity, Global Quality Dividend Income, and Emerging Markets Equity.   

Pacific Current Group

In March, the firm entered into an agreement with Melbourne-based PAC to acquire minority interests in three of PAC’s US-based affiliates. The fund manager will acquire stakes in Avante Capital Partners, Proterra Investment Partners, and Cordillera Investment Partners for an aggregate cash consideration of US$71.2 million ($108 million). 

The boutiques represent the foundational investments for the newly launched GQG Private Capital Solutions (PCS), marking GQG’s first foray into private markets, and will operate independently from GQG’s traditional global equities business.

At the end of April, PAC released its quarterly FUM results at the end of March and said its FUM increased from $50.1 billion at the end of December to $50.6 billion as at 31 March, excluding GQG.

In March, PAC opted to externalise investment management by appointing an affiliate of GQG to provide investment management services to PAC for two years. This allowed PAC to reduce overall costs and convert a significant proportion of expenses from fixed to variable during a period of portfolio reshaping.

The majority of PAC’s US-based employees would become employees of GQG “to ensure continuity while providing PAC a significantly lower cost structure more appropriate for the nature of the portfolio going forward”, the firm said.

FUM at the end of 2023 when GQG was included was $227.3 billion.

Paul Greenwood, PAC chief executive, said: “Obviously the sale of GQG impacts our headline FUM number significantly. 

“While the environment for raising capital continues to be challenging, we continue to expect significant progress at key boutiques throughout 2024.”

Last year, GQG tried to acquire PAC in a bidding war with Regal Partners but was ultimately unable to secure the approval of its largest shareholder, River Capital, and withdrew its bid.