Tyndall sale out of left field: Morningstar

Despite getting a new parent company in the wake of its A$80 million acquisition by Nikko Asset Management, it will be “business as usual” for Tyndall Investments, according to Nikko AM head of Asia Blair Pickerell.

Wednesday, November 17th 2010, 5:00AM 4 Comments

by Benn Bathgate

Pickerell said Nikko AM had acquired an outstanding company with "an excellent brand name, very well known, we don't see any need to change it."

He also pointed out that Nikko has no presence in Australia or New Zealand so there would be no overlap - or job losses - and that the Tyndall brand will remain and the current management will be left to run the operation.

He said the Japanese investment firm has made the acquisition as part of its strategy to "grow into one of Asia's largest asset management companies."

Nikko AM is one of Japan's biggest investment companies and has a considerable presence in China and this acquisition gives the company a foothold in New Zealand and particularly Australia - "the fourth largest investment market in the world", Pickerell said.

Pickerell said Nikko would begin a dialogue with Tyndall investment managers both here and in Australia to ascertain whether the two markets could benefit from the "hundreds" of products Nikko AM can offer.

He also said thanks to its Japanese roots Nikko AM would be able to bring experience of operating in a low-interest rate climate and cited KiwiSaver and Australia's compulsory superannuation as significant attractions.

Asia's fast-expanding middle class was one of the drivers behind Nikko AM's expansion strategy and the company seeks to exploit the growing demand from that demographic for investment products.

"It's a leftfield purchase," said Morningstar co-head of fund research for Australasia Chris Douglas.

He said that while the deal was unexpected it made sense as Nikko AM "is getting a pretty decent Australian and new Zealand fund manager."

He said a takeover by Nikko AM rather than a fellow New Zealand firm was a preferred outcome as a domestic rival would likely merge the operations into one, a move that would reduce investment options in New Zealand.

"Early indications for the deal are very promising," Douglas said.

Benn Bathgate is a business reporter for ASSET and Good Returns, email story ideas to benn@goodreturns.co.nz

« Tyndall Investment Management sold

KiwiSaver mismatch a 'huge challenge' for advisers »

Special Offers

Comments from our readers

On 17 November 2010 at 11:07 am Independent Observer said:

With all due respect to Morningstar co-head of fund research for Australasia Chris Douglas, the “leftfield purchase” of Tyndall was well known throughout the research community, and signalled in my comments to the Good Returns article entitled “Morningstar gives two Tyndall funds a look”, Wednesday, September 29th 2010.

On 17 November 2010 at 12:20 pm Phillip Gray said:

I write as Morningstar's Editorial & Communications Manager. (I think it's good manners to readers to identify yourself, rather than post under a pseudonym, and I encourage others to do the same.)

Chris Douglas' reference to 'left field purchase' was with reference to the identity of the purchaser, not the transaction itself. Nikko is not an established presence in either New Zealand or Australia, so the 'left field' comment is a perfectly justifiable one.

On 17 November 2010 at 3:02 pm BTW said:

Perhaps Morningstar's cause would be better served by it responding to the substance of the discussion rather than bullying the messenger. Does the merit (or otherwise) of IO's comments change one iota if he signs off personally? Do Chalkie's published comments lose their relevancy because he (she?) writes under a pseudonym?
I for one enjoy IO's commentary, and others, as I can focus on the message rather than the messenger.

On 17 November 2010 at 3:27 pm Phillip Gray said:

I don't think my comment about identification can credibly be construed to be 'bullying'; I simply pointed out that I believe that it's a courtesy to readers for posters to identify themselves, to enable readers to make up their own minds about any vested interests or agendas behind the comments being made in posts.