Acquisition of PM Capital increases retail flows at Regal

Regal Partners increased its funds under management (FUM) to $12.2 billion and signaled it may consider smaller complementary acquisitions, after withdrawing its takeover bid for Pacific Current Group last year.

In a presentation to shareholders, the company said FUM was $12.2 billion at the end of April, split between long/short equities, private markets, real and natural assets, and credit and royalties, up from $11 billion at the end of 2023 year.

Since the beginning of the year, it has received a net inflow of USD 400 million.

Regal acquired PM Capital in late 2023 and also took a 50% stake in Taurus Funds Management, a specialist mining finance and royalty company.

According to the company, the successful acquisition of PM Capital enhanced its global long/short capabilities and provided Regal with exposure to the retail investor channel, which diversified its client mix and network of relationships. Previously, the company operated mainly on the institutional market.

He also noted that he is able to charge higher fees for these specialized products compared to traditional long-only or passive product managers.

Chief executive Brendan O’Connor said: “(The inflows) were largely driven by interest in our long/short equity strategies, including some significant institutional wins.

“We have continuously improved our strategies over the years, and our ability to design and adapt the product to customer needs, combined with strong performance, has played a key role in generating net flow.”

Looking ahead to the next fiscal year, the CEO said the company’s growth strategy is based on three pillars: a diversified and scalable development platform, attractive market tailwinds and strong business economics.

Last year, it made a bid to acquire Pacific Current Group but later withdrew the offer in the face of competition from GQG Partners, but this did not deter the company.

“We continue to monitor a number of opportunities to scale up or increase our expertise. This can range from smaller bolt-on trades to larger trades. However, whatever we explore must not impede the existing growth runway, which is significant.

“We have a lot of opportunities to grow organically, and if we were to do something inorganically, we will be very disciplined to make sure it is very attractive to shareholders.”