Westpac buys controlling stake in Hastings Funds Management

TheWestpacBank has agreed to pay $36 million to buy a 51 per cent stake in specialist alternative asset manager, Hastings Funds Management.

In a statement issued today, the bank also announced it had entered into an agreement to purchase the remainder of Hastings after three years.

The as yet undetermined price for the remaining 49 per cent of the company will be based on Hastings’ financial performance, Westpac says.

Westpac chief executive David Morgan says the acquisition of Hastings, which will operate as a division of Westpac Institutional Bank, would boost the bank’s capabilities in the alternative funds management field.

"The acquisition is an another step towards building a higher growth business. This transaction delivers capabilities in specialised funds management," Morgan says.

The move to purchase Hastings follows Westpac’s decision in April to pay $323 million for Rothschild Australia Asset Management, now calledSagitta Wealth Management.

Hastings, established in 1994, is a specialist alternative funds management group, focusing largely on infrastructure, private equity, and high yield debt. The group currently has approximately $2 billion in assets under management, mostly from large superannuation funds.

As part of the deal with Westpac, Hastings’ current management and investment team, including managing director Michael Fitzpatrick, will remain unchanged.

"The new arrangement will provide Hastings with the tools that we believe we need in the infrastructure market going forward, particularly underwriting capacity, retail distribution and marketing,” Fitzpatrick says.

As well as managing discrete mandates on behalf of clients, Hastings also manages the Australian Infrastructure Fund, Utilities Trust of Australia, Queensland Infrastructure Fund, Hastings Yield Fund, Hastings Hancock International Timberland Fund and the Hastings Private Equity Fund.