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Regal Partners grows FUM, flags possibility of ‘bolt-on acquisitions’

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Regal Partners has grown its funds under management (FUM) to $12.2 billion and flagged it may consider smaller bolt-on acquisitions, having withdrawn a bid last year for Pacific Current Group.

In a shareholder presentation, the firm said FUM was $12.2 billion at the end of April, divided between long-short equities, private markets, real and natural assets and credit and royalties, and up from $11 billion at the end of 2023.

Since the start of the year, it has seen $400 million in net inflows.

Regal acquired PM Capital in late 2023 and also took a 50 per cent stake in Taurus Funds Management, a specialist provider of mining finance and royalties.

The successful acquisition of PM Capital, it said, had boosted its global long-short capabilities and given Regal exposure to the retail investor channel which has diversified its client mix and relationship network. Prior to this, the firm was primarily concentrated in the institutional market.

It also noted it is able to command higher fees for these specialist products relative to traditional long-only equity managers or passive products.

Chief executive Brendan O’Connor said: “[Inflows] were largely driven by interest in our long-short equity strategies including a couple of significant institutional mandate wins.

“Over the years, we’ve continued to add to our strategies and that ability to design and tailor a product to meet client demand along with strong performance has been instrumental in driving net flows.”

Looking ahead into the next financial year, the CEO said the firm’s growth strategy is built on three pillars of having a diversified and scaleable growing platform, attractive market tailwinds, and strong business economics.

It bid last year to acquire Pacific Current Group but later withdrew in the face of competition from GQG Partners; however, this has not deterred the business.

“We continue to monitor a range of opportunities to add additional scale or expertise to the business. This may include smaller bolt-ons as well as larger transactions. But whatever we explore must not hamper our existing runway for growth, which is substantial.

“We have multiple opportunities for growth organically and, if we were to do anything inorganically, we will be very disciplined to make sure it’s highly accretive to shareholders.”