van Eyk, the most influential research firm in the financial planning market, has a new cornerstone investor following the departure of the company’s namesake. GREG BRIGHT reports on the new-look van Eyk and the major shareholders’ plans for sustained growth. Mark Thomas has a new partner at van Eyk and, more importantly, he has the catalyst and firepower for some big changes to how his business is run and the firm’s position in the financial services market. The new cornerstone investor is Torchlight Investment Research and Management. The chairman of Torchlight, George Kerr, orchestrated the purchase of about 32 per cent of van Eyk from the firm’s co-founder, Stephen van Eyk (who retired from the firm early this year), and some small shareholders.
Kerr is a successful New Zealand investor and business-builder in financial services, who now divides his time between New Zealand and Sydney, Thomas, who remains the largest shareholder in van Eyk, alongside family interests, says the new shareholding represents the “next step” in the process of building on the company’s core research and funds management capabilities. The first step, early this year, involved the separation of the company’s governance – its board – from management, with the appointment of a majority of independent directors under acting chair Cameron McCullagh. Torchlight is discussing board representation for its interests. The second step involves both the introduction of new blood among the shareholders and strengthening of management through the addition of senior resources.
Thomas has hired a general manager, Jeff Hall, from Macquarie Bank, who starts in July. He is also looking to strengthen van Eyk’s research team. The new cornerstone investor gives van Eyk, for the first time in its 21-year life, access to the capital and resources to make acquisitions and fast-track organic expansion. Torchlight’s purchase values the company at $13.8 million. For the third step, we will need to revisit the story in a couple of years. Chances are, though, it will involve a build-up of funds management and a strengthening of the existing bonds with financial planners, perhaps with the provision of equity positions in practices. Torchlight is ultimately owned and managed by New Zealand-listed banking and wealth management group Pyne Gould Corporation, of which Kerr is the largest single shareholder. Pyne Gould dates back to the 19th century, when Kerr’s great-great grandfather, FH Pyne, was a stock and station agent who loaned money to New Zealand farmers. In 2009 George Kerr substantially lifted his stake in the company to 15 per cent when, along with leading New Zealand investment bank, First NZ Capital, and some major Australasian investors, underwrote an A$277 million rights issue.