With the change of ownership for what is now PineBridge Investments, investors can expect a greater focus after two years of turbulence for the US$88 billion manager. PineBridge, the former funds management arm of American International Group (AIG), was acquired by Hong Kong-based investment company Pacific Century Group (PCG) in March. Under the new ownership, PineBridge will gradually issue “a significant minority” of shares in the company to management, according to the long-standing chief executive, Win Neuger. Neuger, who started PineBridge after joining AIG about 15 years ago, said the major change for the firm was that it would be more entrepreneurial, with a focused group of about 900 staff as opposed to being part of a company with more than 115,000 as AIG was before it began to be split last year following its financial crisis in 2008.

In Australia, PineBridge has recently appointed an equities manager to work alongside Clinton Grobler, the managing director and head of business development in Australia. Grobler said that Australian investor’s interest in China and India played to PineBridge’s history and presence in those countries in particular, and emerging markets more broadly. He joined AIG in San Francisco in 2007 and relocated to Melbourne the next year. “Working off PineBridge’s global multi-strategy platform which includes listed equities, fixed income, hedge funds of funds and private equity, I am highlighting our teams and products that can potentially fill those interests,” he said. Neuger says that another benefit of the new ownership from clients’ perspectives is that the firm will be able to offer its capabilities in some previously capacityconstrained asset classes such as non-performing loans.

“Previously our philosophy was that if we didn’t have significant capacity we wouldn’t offer it to external clients because we knew AIG would absorb it,” he says. About a third of PineBridge’s assets under management are in alternative mandates and funds, a third in listed equities and a third in fixed interest. While the product range is a wide one, Neuger says that most strategies are high-alpha seeking. For instance, in fixed-interest the firm has a lot of high yield, emerging markets debt and bank loans mandates. In listed equities, it has some enhanced index funds at one end of the risk spectrum and concentrated and high-alpha products at the other end. The alternatives area includes both hedge funds of funds and private equity.

When Neuger was tasked with forming the funds management arm of AIG in 1995, he inherited not one but several different investment departments of the big insurance company. He consolidated the various groups and expanded capabilities both into new asset classes and geographically. The firm currently has offices in 31 countries, most of which have both investment professionals and business development people. Neuger says that PCG is an attractive new owner for the firm, with a long-term perspective. It previously had an exposure to asset management through a holding in an insurance company which was subsequently sold, and had indicated a desire to re-enter the funds management industry, Neuger says.

Leave a comment