Canadian asset manager British Columbia Investment Management Corporation (bcIMC) has reached an agreement with Britain-based credit investment firm Hayfin Capital Management to fully acquire the majority shareholding of Hayfin from the existing consortium of institutional shareholders.
Financial details of the transaction, subject to regulatory approval, remain undisclosed.
The deal aims to support Hayfin’s long-term growth plans and simplify its ownership structure. Hayfin’s management and employees remain shareholders alongside bcIMC. Also the new majority shareholder will pour capital into Hayfin’s funds.
“Hayfin’s principal focus will remain managing assets for third parties; the day-to-day independence of the Hayfin team over operations, investments, and personnel will be unaffected by the change in ownership,” stated Hayfin, which has €8.2bn of assets under management.
Tim Flynn, CEO of Hayfin Capital Management, commented: “This long-term investment from bcIMC will provide the access to capital and streamlined ownership structure to realise our ambition of becoming Europe’s leading credit platform. What won’t change under the new ownership arrangements is the independence of Hayfin’s experienced team of credit investment professionals, or our commitment to delivering high-quality returns for the third-party investors whose capital we manage.”
Jim Pittman, senior vice president of private equity at bcIMC added: “We see this as a strategic long-term investment in a leading company that has the potential to generate value-added returns for our clients. Having known the Hayfin team since inception, I’m confident in their strategy and ability to further expand their business and raise additional capital through their funds.”
British Columbia Investment Management Corporation has C$122bn (€86.4bn) in assets under management.
CC-BY-SA-2.0, FlickrPhoto: El equipo de EXAN Capital Realty en Miami. EXAN Capital Realty, in Charge of Selling PAYCO
One hundred percent of the shares of a Luxembourg-based company known as Paraguay Agricultural Corporation S.A. (PAYCO) are being offered for sale.
Through its Paraguayan subsidiary, PAYCO manages over 144,000 hectares (355,832 acres) of land throughout that country, where it conducts agricultural, cattle, and forestry activities.
EXAN Capital Realty, a Miami-based real estate investment advisory firm, was engaged to carry out the sale process.
The portfolio includes 6 full-ownership properties amounting to more than 128,000 hectares (316,295 acres), representing 88.9% of the portfolio, and 8 leased properties adding another 16.000 hectares (39,537 acres), or 11.1% of the portfolio. PAYCO currently holds 38,500 head of cattle, 15,800 hectares (39,043 acres) of agricultural production (chiefly soybean, rice, corn, and wheat), over 5,000 hectares (12,355 acres) of forestry plantations, and 25,000 hectares (61,776 acres) of natural forest.
Paraguay is one of South America’s most attractive agro-business markets, both because of its favorable climate and the quality of its lands. Other significant factors are its political stability, fiscal regime, and its open-arms attitude toward foreign investment.
The presumably highly competitive sale process is scheduled to start during the first half of February.
Given the magnitude of the asset, its sale should fetch the attention of global investors, including sovereign funds and any other group that recognizes in PAYCO a magnificent upside and sustainability opportunity.
CC-BY-SA-2.0, FlickrPhoto: Tadson Bussey. PIMCO Launches an Absolute-Return UCITS Fund
PIMCO, a leading global investment management firm, has launched the PIMCO GIS Mortgage Opportunities Fund, which aims to generate consistent, absolute returns across full market cycles by investing in a broad range of mortgage-related securities. The fund is managed by Daniel Hyman, Alfred Murata and Josh Anderson, a global team of Portfolio Managers.
The fund provides investors with a dedicated exposure to the global mortgage-backed securities (MBS) market. Untethered by a traditional benchmark, the fund has the flexibility to tactically allocate across various subsectors of the global MBS market, and actively manage exposure to a variety of risk factors, including interest-rate risk and credit risk.
The $11 trillion securitized market represents a meaningful portion of the global fixed income market and has historically provided attractive risk-adjusted returns with limited correlations to equity and credit.
Daniel Hyman said: “Given the historically low yields on core bonds, and the correlation of corporate credit to equities, a dedicated allocation to securitized assets can help investors improve the overall diversification of their portfolios while also potentially enhancing returns.”
PIMCO is one of the largest investors in securitized assets with more than 30 years of investment experience in the asset class. The team covers the entire spectrum of mortgage related assets from around the world, seeking out the best value investment for clients.
The PIMCO GIS Mortgage Opportunities Fund is available in a variety of share classes in different currencies. As of January 30, it is registered in Austria, Belgium, Denmark, France, Germany, Ireland, Italy, Luxembourg, Netherlands, Norway, Singapore, Spain, Sweden and the UK.
Key wealth markets are set to experience a surge of new business models and further industry consolidation akin to that of broker consolidators in the UK insurance market, as the independent financial advisor (IFA) workforce ages and new technology and capital is introduced, according to financial services research and insight firm Verdict Financial.
The company’s latest report states that one of the more optimistic predictions for the future involves the aging, predominantly baby boomer advisor base in places such as Australia, Canada, the UK and the US, and posits a novel exit strategy based on robo-advisors looking for new clients. This prediction is modeled on the broker consolidation trend in the UK, but substitutes cashed-up robo-advisors for the traditional broker-consolidator.
Robo-advisors are online wealth management services that provide automated, algorithm-based portfolio management without the need for human financial planners. With many offering largely exchange-traded fund (ETF)-based portfolios, their hallmark is very low fees. Robo-advisors were arguably the hottest fintech trend in wealth management in 2016, with dozens launched around the world.
Andrew Haslip, Verdict Financial’s Head of Content for Asia-Pacific, says that with their rock-bottom fee structures, independent robo-advisors only break even with pools of client assets well above industry averages, something even the most successful companies, such as Bettermint and Wealthfront, will struggle to achieve this year even in the US, the world’s largest wealth market.
Haslip explains: “Inflows to robo-advisors, while positive, have slowed and smaller robo-advisors or those in smaller markets such as Australia will remain well below the necessary volume based on current trends. For robo-advisors looking to scale up their client assets quickly, the wave of retiring advisors, along with the current low cost of capital, offers a once-in-a-lifetime opportunity, provided they pay for it.”
Verdict Financial believes high profile robo-advisors in 2017 could tap the market for the capital necessary to buy the client books of retiring financial advisors, whose generally affluent older customers tend not to have considered a robo-advisor.
Haslip adds: “The clients will benefit from cheaper ETF-based portfolios, while robo-advisors boost their client assets. So keep your eye out for the wealth industry’s newest trend, the robo-consolidator.”
Wikimedia CommonsFoto: Garrett A. Wollman. Allianz Global Investors aumenta su mandato con State Street
State Street Corporation has been appointed by Allianz Global Investors to provide a wide range of investment services. The agreement expands an existing relationship into a strategic global partnership with State Street delivering a broad spectrum of investment servicing solutions for more than EUR 450 billion in assets under management.
State Street will provide middle and back office solutions including fund administration, depository and trustee services, global custody, transfer agency, share class hedging, and data consolidation services. The mandate remains subject to approvals of applicable funds’ boards as well as customary regulatory approvals.
Jeff Conway, chief executive officer for EMEA at State Street said, “We are delighted to expand our relationship with Allianz Global Investors and are looking forward to the next phase of this strategic partnership, which defines a new service model for leading asset managers. State Street’s data consolidation and analytics capabilities are a cornerstone for creating a joint end to end operating model that will service AllianzGI across all asset classes and jurisdictions and support their future growth. This mandate demonstrates the value of a true partnership with our client.”
Photo: Glenn Koach and Tom Krasner, co-founders at Concise Capital Management / Courtesy photo. Concise Capital Launches its Niche High Yield Corporate Bond Strategy
Concise Capital Management, an independent fund management company affiliated with Canepa Management, that has over US$ 250 million in assets under management, and that specializes in short-term, underfollowed high yield bonds, launched its first UCITS fund in November 2016.
The new UCITS fund, which invests in high yield corporate debt, focuses on Concise Capital’s investment philosophy and looks for value in the inefficient part of the high yield bond market. The result is a portfolio that generates a high level of income, while minimizing credit risk, reducing volatility, and adding diversification.
Glenn Koach and Tom Krasner founded Concise Capital in 2004. Concise Capital already runs a Cayman Islands domiciled hedge fund, sub-advises a 1940 Act mutual fund, and manages separate accounts. Mr. Koach and Mr. Krasner expects that the UCITS fund will fill a need for high current income while avoiding interest rate risk for European and other offshore investors who are seeking daily liquidity. “We have gauged strong interest in alternative assets, such as short-term, under-followed high yield debt” said Tom Krasner, co-founder of the firm. “At the moment, we are targeting institutional investors and retail investors in Europe, particularly in the UK and Switzerland. In the longer term, we expect to market the UCITS to LATAM investors and the US offshore market,” he added.
The fund’s management team is led by Tom Krasner, who has a track record of more than 25 years in evaluating fixed income, distressed debt, and high-yield bonds, and by Glenn Koach, who has over 30 years in experience managing short-term high yield bonds.
Prior to founding Concise Capital with Koach, Krasner was Executive Vice President at Harch Capital Management, responsible for restructuring high yield debt and bank loans. Prior to that, Krasner was a Principal and Portfolio Manager at Riverside Capital Advisers, where he co-managed a short-term high-yield bond strategy with Koach. In 1984, Koach co-founded Riverside Capital Advisers a boutique institutional investment management company that grew to US$ 400 million in assets under management.
Foto: Santi Villamarín
. Aumenta el interés entre los inversores institucionales estadounidenses por el liability-driven investment
“Institutional investors have faced a variety of pressures during the past year that have made achieving their investment goals very challenging,” states Chris Mason, senior analyst at Cerulli with regards to the January edition of The Cerulli Edge – U.S. Institutional Edition. “Unfavorable forward-looking returns across several asset classes and recent shifts in the interest rate environment have created additional uncertainty.”
“The difficult market environment, including historically low interest rate levels, has wreaked havoc on corporate defined benefit planned sponsors,” continues Mason. “However, the recent increase in interest rates following the election has sparked renewed interest in pension derisking and liability-driven investing (LDI) among these institutional investors.”
Cerulli believes that in order for managers to serve their clients most effectively, it is imperative they understand how these specific challenges affect institutions as a whole. As rates continue to rise, managers should focus on highlighting their LDI solutions. Proactive managers that educate plan sponsors about the benefits of derisking will be the best positioned in the marketplace.
CC-BY-SA-2.0, FlickrFoto: Gage Skidmore. La renta fija estadounidense sigue a la espera de Trump
As Trump continues to carry out his campaign promises and prepares to launch his stimulus plan, the Fed meets in the midst of a complicated state of affairs. The meeting will bring no surprises, especially after Janet Yellen said that the trend in wages does not guarantee that the Board which she presides will take additional measures this time.
However, several analysts agree that the market may be underestimating the expected pace of interest rate hikes. One of these analysts is Frank Dixmier, Global Head of Fixed Income for Allianz Global Investors.
“The difference between the Fed’s forecast report – known as the ‘dot plot’ – and market expectations is of particular importance. The points show the FOMC consensus expectations on three rate hikes this year and a further three in 2018. However, the market expects only four rate hikes in total over the next two years – a significant difference,” he explains.
The problem is that this gap between market expectations and the future pace of rate hikes shows that there is some fragility in US markets, “particularly given the increasing pressure from the labor market”, says Dixmier. It is in the interest of the Fed to clearly explain the pace of increases to allow markets to adjust fluently.
Eric Stein, Co Director of Global Income at Eaton Vance, admits that he was somewhat surprised when the Fed boosted its ‘dot-plot’ at the December meeting. “I had expected this to happen in March this year, when the market might have more information on the specific policies of President elect Donald Trump,” he states in the management company’s blog
“That said, I do think we could get more hawkish surprises on the dot plot in 2017. The economy was accelerating somewhat before the election, and inflation and inflation expectations had also been picking up pre-election as well. If we get regulatory reform, tax reform and infrastructure spending from the Trump administration and Congress in 2017 and the economy really gets going, then the Fed is going to hike more than investors expect.” Stein summed up.
And it’s that at this time the meetings of the Fed have a certain tone of state of war, but without open confrontation. All indications are that Trump is going to enact policies that will force the Fed to act. Similarly, the people he chooses to fill vacancies on the committee will determine to some extent the way the Fed moves. However, nothing has happened yet so everyone is waiting to receive more information.
“Much of it has to do with the appointments he will make to the Committee. If he implements some draft fiscal reforms, this should lead to higher rates, and to the strengthening of the dollar. However, a stronger dollar would not help the American producers, on whom Trump shows so much interest. If he tries to appoint candidates who are sympathetic to his political ambitions, then we might see how little he likes the independence of the central bank,” says Luke Bartholomew, fund manager at Aberdeen AM.
Markus Schomer, chief economist at PineBridge Investments, also believes that the Fed’s position is largely tied to the policies put in place by the new president of the United States. “The market’s performance in the first half of the year will depend on Trump’s projects. If he focuses on tax cuts and deregulation, the economy and markets are likely to take off. If it comes to trade restrictions and reduced health care coverage, sentiment could turn around and growth could slow down.
What if Trump puts all these policies in place at once?
The expert at Loomis, Sayles & Company, a subsidiary of Natixis GAM, agrees with the rest of analysts. “The introduction of fiscal stimulus could push inflation, prompting the Fed to tighten its monetary policy sooner than the markets are discounting,” says Gregory Hadjian, member of the firm’s macro team.
After two years of serving a select group of leading real estate investment managers, Juniper Square announced the launch and general availability of its market-leading investment management software.
Clients such as Beacon Capital, The Reliant Group, and Cortland Partners rely on Juniper Square to help them manage nearly 20,000 investment positions and over $25B in capital. More than 8,000 investors use Juniper Square to access reporting on nearly 1,000 investments, and Juniper Square customers are currently raising capital for more than 130 offerings using its software.
Juniper Square’s technology integrates many capabilities into a single capital markets software system: a CRM designed for real estate; a secure data room and automated subscription process to streamline fundraising; a powerful investment accounting system that can scale to the most complex funds; and an automated, best-in-class investor reporting capability designed to meet the needs of even the most sophisticated investors.
“Moving from our previous system to Juniper Square was like night and day. Having a common source for our latest fund and investor data has enabled our accounting, investor relations, and fundraising teams to work together more efficiently. In addition, our investors value having self-service access to comprehensive investment data through Juniper Square’s easy-to-use portal,” said Dane Rasmussen, Managing Director and Head of Investor Relations, Beacon Capital.
“Real estate managers today are buried under mountains of spreadsheets and struggle with antiquated systems that are hard-to-use and don’t talk to each other. Juniper Square puts an end to that with an easy-to-use, integrated system that supports the entirety of the capital markets operation, from front office to back. Whether they have ten investors or thousands, our software frees up managers to focus on what they do best: buying, selling, and leasing real estate, while providing an unparalleled experience for their investors,” said Alex Robinson, Co-Founder and CEO of Juniper Square.
Confirming this trend, in its 2016 Global Private Equity Fund and Investor Survey, EY found a “seismic shift” in the importance of reporting when investors select a manager, stating, “In just one year, we see a 400% increase in investors that now rank a private equity firm’s ability to handle reporting requirements as the most important when selecting a firm.”
Juniper Square’s modern, easy-to-use software helps real estate sponsors of all sizes respond to the growing demands of the industry. Whether the challenge is seamlessly managing relationships with thousands of individual investors, or meeting sophisticated institutional reporting needs, Juniper Square enables real estate firms to focus on the real estate instead of the back office.
The European Fund and Asset Management Association (EFAMA) published itin January is latest Investment Funds Industry Fact Sheet, which provides net sales of UCITS and non-UCITS for October 2016. 28 associations representing more than 99 percent of total UCITS and AIF assets provided with net sales data.
Bernard Delbecque, Senior director for Economics and Research at EFAMA commented: “Despite anemic net sales of equity funds since January 2016, UCITS continued to attract robust new investment in October thanks to net inflows into bond, money market and multi-assets funds”.
The main developments in October 2016 can be summarized as follows:
Net inflows into UCITS and AIF totaled EUR 62 billion, compared to EUR 51 billion in September.
UCITS registered net inflows of EUR 47 billion, up from EUR 30 billion in September.
AIF recorded net inflows of EUR 15 billion, down from EUR 21 billion in September.
Total net assets of European investment funds stood at EUR 13,756 billion at end October, compared to EUR 13,836 in September and EUR 13,320 billion at end 2015.
Going into further detail:
Long-term UCITS (UCITS excluding money market funds) recorded net inflows of EUR 22 billion, compared to EUR 28 billion in September.
Equity funds recorded net outflows of EUR 1 billion, compared to net inflows of EUR 2 billion in September.
Net sales of bond funds increased slightly from EUR 16 billion in September to EUR 17 billion in October.
Net sales of multi-asset funds decreased slightly from EUR 7 billion in September to EUR 6 billion in October.
UCITS money market funds recorded net sales of EUR 25 billion, compared to EUR 2 billion in September.
