Mercer
Investment Consulting will create a new global head of alternatives research
position as part of its acquisition of US consulting partnership Callan
Associates.
Mercer
announced last month plans to merge the investment consulting businesses of the
two firms in late March, making Mercer the largest investment consultant in the
US.
Tony Cole, business leader, Asia Pacific at Mercer Investment Consulting said
the new post was likely to be filled by a Callan employee.
Some
of the Callan staff would be included in Mercer’s senior management structure,
and there were no plans to change any of the regional heads of investment
consulting, he added.
“Within
the way our research group’s organised we are going through a process of
reorganising our researchers and that recognises the increased focus we’ve had
for the last year or so on
alternatives
research,” Cole said. “It will be quite a senior position – head of
alternatives research globally – which is likely to be filled by somebody at
Callan.”
Callan
has no Australian superannuation fund clients, and does not have any employees
based in
Australia.
Steven
Vaughan was an Australian representative of Callan for several years until
recently, when he left to form a new incubator business with Macquarie Bank
called Queen Street Partners. The acquisition adds 170 employees to Mercer’s
investment consulting stable, bringing the total number across the globe to
1100. Cole said there might be a “handful” of people that don’t fit the new organisation;
however he did not anticipate many redundancies. “There may be a small number
but
this
acquisition hasn’t taken place on the basis that we can take overheads out of it
or find savings, it’s really been done on the basis that we needed to get
scale,” he said.
He
said the biggest advantage of the acquisition was the increased number of researchers
within the new organisation.
“By
combining in a very fragmented market it gives us a scale advantage that we
haven’t had before,” he said. “With that scale we will be able to broaden and
deepen our research capacity in the
United States, which of course is
one of the powerhouses of investment globally – lots of managers, with lots of
strategies, [and] lots of new
ideas.
The improvement is in enhancing our understanding of US managers and strategies
that come out of the
US.”
As soon as the deal’s complete, Mercer will combine the team responsible for
developing and maintaining manager research tools such as Mercer Performance
Analytics (MPA) with Callan’s team.
MPA
was built by Steve Jackman, principal at Mercer Investment Consulting, based in
Melbourne.
“Callan
has a tool that’s similar [to MPA],” Cole said. “Our technical people who built
our tool and have maintained it have looked at the Callan tool and seen that it
has capabilities that our system doesn’t have. That will be a clear area where
we will be able to enhance the tools we use in consulting.”
