A world where animal spirits are running wild is also one that has temporarily divorced from fundamentals. Experience tells us this often doesn’t end well.Â
The wealth transfer from Baby Boomers to their offspring, which is in full swing, has got the taxman’s full attention, especially as it pertains to capital gains payments, trust structures and potential breaches of the Tax Act’s Division 7A.
How Nikko and Tyndall are leveraging off each other’s capabilities
Having just completed a roadshow marketing its World Bank green bond fund in Australia, and a series of general institutional presentations on the firm’s integration with parent Nikko Asset Management, Tyndall Investment Management is now embarking on a marketing campaign for its Australian investment strategies.
The $A23 billion firm, acquired by Nikko in late 2010, is being transformed into a diversified global manager of both alternatives and traditional strategies, with the Australian arm looking to export several innovative offerings, such as a water investments product in development, and import others, such as the green bond fund.
“It’s a two-way approach,” says Mike Davis, the Tyndall CEO. “We’re also starting to market our loan investment strategy in Japan, which is the old Causeway product. And, hopefully, we’ll be bring the Nikko Asian Bonds strategy to Australia soon.”
Davis and partner Tim Martin, Tyndall’s head of alternate assets, took over the management of Tyndall last year after their boutique loans investment firm, Causeway Asset Management, was acquired by Tyndall. The five-person Causeway team came over to Tyndall and acts as the core of the alternatives unit.
The net result is that a traditional Australia-only value equities and fixed interest shop, which has weathered various market cycles and owners since it was established in 1989, has been given a new lease of life more suited to the increasingly specialist demands of big pension funds.
Causeway had been a struggle for Davis and Martin. The firm aimed to fill the void left by the banks after 2007 by looking to raise money from super funds which could be lent to SMEs. Despite a compelling narrative and good returns, super funds were reluctant to take on a new alternatives strategy. Under the Nikko umbrella the product looks decidedly more attractive.
Davis says that the Nikko model is a “multi-local concept”. This means that Tyndall has a lot of autonomy while also leveraging off the parent’s product range and distribution.
The green bond fund, managed by Nikko’s London currency and fixed interest team in conjunction with the World Bank, invests in World Bank bonds which are underwriting various sustainability projects throughout the world.
Similarly unique, the Causeway Water Fund will invest in water entitlements, most of which are leased to farmers and other customers, but with some retained for trading purposes. The owners of the entitlements retain an exposure to the rising price of water in Australia, while also getting a yield from the short, medium and long-term leases.
Meanwhile, Nikko’s president, Bill Wilder, announced last week that he would retire at the end of this fiscal year. The CEO, Charles Beazely, becomes president from April 1.
