PAC CEO denies firm is on a ‘wind-up path’
Acting Pacific Current chief executive Michael Clarke has denied the firm is on a “wind-up path” but says there will likely be further divestments to come in FY25.
During the financial year, the firm considered bids from GQG Partners and Regal Partners to buy the company. It then opted not to pursue this opportunity and instead announced the sale of its stakes in Avante, Cordillera and Proterra for US$71.2 million to GQG.
In May, it sold its partial stake in alternative asset manager Pennybacker Capital Management to Goldman Sachs Asset Management.
Since the end of the financial year, the firm has also announced it will sell its interest in Carlisle to alternative asset manager Abacus Life in July, and divested Victory Park Capital to asset manager Janus Henderson in August.
In its FY24 results, the firm said this had enabled it to report cost savings of over 40 per cent to materialise in FY25 onwards.
Commenting on the deals on a shareholder call, Clarke said: “With so many asset sales, it may appear that it’s been a strategic decision to sell, however that is not the case. All of these have been driven by outside buyers expressing interest in the firm’s assets and fortunately their offers have been quite attractive with all transactions occurring at, or above, PAC’s estimate of fair value.”
Clarke was appointed earlier this year after former CEO Paul Greenwood left to join the new private credit solutions business at GQG Partners, which was formed after the acquisition of the three asset manager stakes.
Asked by an analyst where the business will be in five years, Clarke said: “The current activity has been driven by groups approaching us. All of these transactions have been conducted at fair value or above, some materially above fair value.
“There will be potentially further disposals going forward. We may invest in some of our existing boutiques; there will be regular portfolio activity in our boutiques in terms of their needs and situations. Over five years, it is likely some boutiques will progress and some will face challenges, and that’s to be expected.
“There is no sense of winding up the business, that’s not in the current mindset of the board. We want to continue with our current activity, which is investing in specific opportunities, and the opportunities we know best are the existing boutiques where some are performing very well.”
AUTHOR
Laura Dew
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