Hastings Funds Management, the Melbourne-based infrastructure asset manager, has expanded its offshore business by gaining a $1.14-billion mandate from the RBS Group Pension Fund.
The London-based RBS fund, which oversees about $26 billion in staff retirement savings, chose Hastings to manage infrastructure debt or equity assets in the UK and Europe for its investment portfolio. It wants so-called core assets providing steady cash flows that keep pace with inflation to help it pay pension benefits. Andrew Day, chief executive of Hastings, said net annual returns of up to 13 per cent could be achieved.
The deal, secured by Hastings’ 10-person team in London during a competitive tender, lifts the amount of capital it has sourced from overseas investors to $1.6 billion. The manager, which also has offices in New York and Sydney, runs a total of $7.7 billion, including the $610 million it drew this month from existing and new investors in its Utilities Trust of Australia.
“We want to complement our capital-raising capabilities in Australia with increased capital raising overseas,” Day said in a telephone interview yesterday. “We are seeing demand from Europe, North America and Asia.”
Hastings’ Australian team is currently responsible for garnering capital from Asian investors. This may change. “Ask me again in three or four months,” Day said in response to a question about whether the company has an office in Asia.