The head of Credit Suisse Asset Management Australia, Steve Giubin, has not ruled out forming a boutique with his small cap and/or large cap Australian equity managers, saying all options were on the table during the "frustrating" wait for Aberdeen Asset Management’s global takeover of CSAM’s traditional businesses.
Sources in the boutique incubator business said last week that overtures had been made on behalf of at least CSAM’s small caps team, Issam Eid and Steven Ng, who jumped ship from ING Investment Management in 2007.
On the surface there would appear to be little future at Aberdeen for Eid and Ng, nor CSAM’s large cap Aussie equity team which includes Giubin, Richard Kornman, Michael Jenneke and Heath Behncke.
The chief executive of Aberdeen Asset Management Australia, Bill Bovingdon, has already said that Aberdeen’s process is "not negotiable" across the Australian equity and fixed income assets it is purchasing from CSAM. Both the Aberdeen and CSAM large cap processes are considered "core" by Morningstar, however their methods are quite different, with Aberdeen generally lower-turnover and higher-tracking error, and CSAM more focused on earnings growth.
However, given that CSAM will receive a 24.9 per cent share of Aberdeen in return for the traditional businesses, Giubin said he and fellow CSAM executives had influence in what the new business would look like. He pointed out that CSAM was the larger business in Australia and had greater retail distribution.
Asked to comment on market talk that he and the small cap managers were considering establishing a boutique, Giubin replied that it "could be the large cap guys are involved as well, it could be we all work together in the new entity under Aberdeen…it’s all on the table."
Giubin admitted the wait for the April 30 target date for the Aberdeen takeover was frustrating.
"Our clients are ringing us every week or two to find out what’s going on, and there’s not a lot new we can tell them…It’s a slow process, and slower here than in other parts of the globe because CSAM Australia is a separate company from the rest of the group, it’s responsible entity for all the trusts, and an entity sale is more complicated than a simple transfer of assets."
Following the transfer to Aberdeen, CSAM’s remaining asset management interests in Australia will be in the alternatives space, including credit and high-yield funds, a commodities fund and a hedge fund-of-funds.