Salt not maxed out

Salt Asset Management says has capacity to take on more clients, despite receiving a big boost to its funds under management from AMP yesterday.

Friday, March 20th 2015, 6:00AM 1 Comment

by Susan Edmunds

It was announced the two-year-old fund manager had won the mandate for AMP Capital’s active New Zealand equity funds.

That adds just under $700 million to Salt’s FUM and it has been estimated it may almost double it.

From the start of April, Salt will manage the AMP Capital NZ Shares Fund, AMP Capital Strategic NZ Shares Fund, AMP Capital Responsible Investment Leaders NZ Shares Fund and the New Zealand equity component of the AMP Capital Income Generator Fund.

AMP Capital head of distribution George Carter said Salt was selected from a shortlist because of its ability to align with AMP Capital’s existing New Zealand equities investment philosophy and process.

Salt managing director Paul Harrison said the firm would not need to hire anyone new and it would be business as usual. “We’ve already scaled the business as if we were a large business. We wouldn’t have got the mandate if we’d need to hire more people. We took the view that if we pitched for the mandate we needed a business that was already sized for the FUM this would bring us.”

He said all the firm’s investment processes would continue. “It’s reasonably seamless for us to take the money on but it gives us critical mass in the marketplace.”

AMP’s decision to choose a New Zealand firm was a vote of confidence in Kiwi fund managers, he said.

Harrison said the firm still had plenty of headroom to take on more clients.

Mercer analyst David Scobie said it pushed Salt from the mid-tier of the market to become one of the bigger players.

Salt was created by former employees of Westpac’s New Zealand fund management arm, BT Funds Management, which contracted out the management of its New Zealand equities and property holdings to Salt in 2013.

Scobie said the AMP move gave Salt a little more diversity. Previously, Westpac was its only client. “It’s still a concentrated client base but obviously two is better than one.”

He said the mandate being run on the AMP funds would be defined by AMP rather than merged into the Salt strategy.

Scobie said Salt might now be analysing whether it could take on the NZ Super Fund mandate that AMP lost last year. The portfolio was worth $257.5 million.

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