The industry fund has taken a 49 per cent stake in subscription vehicle provider Splend alongside IFM and other co-investors as it looks to build a 10 per cent exposure to climate solutions in its global portfolio.
After years of powering super returns into the double digits, US equities are walking a tightrope, and one misstep could send them plunging to earth. But the story that put them up there in the first place still holds true.
Class action dominos starting to fall
The dominos have started to fall for Australian-related class actions with the market having become “passive enough” that investors are looking to update their policies to ensure they can partake in the potential gains from legal actions.
Two high-profile cases, Crown Resorts and Vocation, have deadlines today (March 4) for investor registration. According to Financial Recovery Technologies there have been eight actions between the fourth quarter of last year and the first quarter of this year.
“The market is growing exponentially,” says Andrew Lasky, the Boston-based senior legal product specialist for the firm, which has had Australian representation since 2016 and has recently expanded its team having appointed Emma-Jayne Page in Sydney to lead account management and customer success.
Lasky said on a visit to Australia last week that the Australian market was evolving along similar lines to that in the US where big investors can take a passive approach, maintaining anonymity. But they have to register with the courts by a certain date to be able to participate in any winnings. As in the US, investors don’t pay anything to participate but unlike the US, Australian lawyers are only allowed to charge for their time, not as a proportion of the result. They will usually have a third-party litigation funder.
FRT currently has more than 30 super funds and managers on its books in Australia, which Nicholas Allen regional lead for Financial Recovery Technologies describes as a “shareholder litigation governance solution which reduces the calorie burn if an investment firm does the work in-house”. FRT does not provide legal advice but, rather, fiduciary guidance, Lasky says.
“Litigation organisers blast out solicitations to the whole market, so we synthesise the information for clients according to the thresholds stipulated in their individual policies,” he says “We’re in the business of reducing the noise. We’re working with the organisers to develop new procedures because they have to facilitate bulk registrations.”
Very few cases reach the trial stage. In Australia, there has never been a case thrown out by the courts. Typically, the litigation organisers, including legal teams, will charge between 15-30 per cent of a settlement.
FRT spends a lot of money on technology, including cyber security. “We have about US$27 trillion in securities information in the system so security is very important,” Lasky says.
– G.B.
