Home / Analysis / How this global giant plans to become a go-to manager for super

How this global giant plans to become a go-to manager for super

The AUD$660 billion M&G has been a “sleeping beauty” down under, and it wants more than the mandate it already runs for the Future Fund. Thinking like an asset owner is part of the equation.

M&G is a powerhouse globally, but is little known in Australia despite sitting in the Future Fund’s roster of managers. It’s now setting itself down in front of big super funds and wealth managers with an eye to becoming an indispensable service provider.

And Amy Cho, M&G’s APAC head, thinks the trend of super fund consolidation means there’s plenty of opportunity for large, diversified players.

“We want to accelerate growth, and we want to be a go-to manager,” Cho tells ISN. “(Consolidation) gives us an opportunity because we don’t have everything, but we do have a good suite of capabilities, from public to private markets. On the public side we manage a very decent amount of assets in multi-asset credit, and have a global private market capability and a real assets team in Australia that helps manage our Asian property portfolio.”

  • The UK-based manager has been handling high grade debt investments for Australia’s sovereign wealth fund for the last decade or so, and wants to expand its offering to the superannuation and wealth management markets, which now handle vast sums of FUM by themselves. That means finding an unmet need, which Cho believes lies in multi-asset credit, where the “window can’t be more perfect”; M&G has been shopping its Alpha Opportunities fund to local institutions.

    “The (current regime) is very suitable for quality credit, and our management style is total return. Our intention for our strategy is as a building block for sophisticated investors, and we think we provide a good blend to complement and supplement traditional fixed income investments.”

    But in the age of internalisation, institutional-grade managers need more than just a shiny new product for a mostly unserved niche. The new model for managers who want to win mandates from antipodean institutional investors is partnership; not just shoving a fund under their noses, but engaging in a frank exchange of views – and IP.

    On that front, Cho thinks M&G has the advantage. It’s the former asset management arm of  insurer Prudential – and wears some of its branding in the UK – and can think like the super funds it’s shopping its wares to.

    “(Funds) want to work with an organisation that they can sit down with and say, ‘What can I learn from you?’. We’re here to be an asset manager, but we’re also an asset owner. We can talk about issues and pains we share, because we have the life portfolios. It’s a long-term relationship and partnership, and supermarket sales don’t work down here.”

    Staff Writer

    Print Article

    Private debt lands on IMF radar

    The International Monetary Fund has urged regulators to keep a close eye on private debt as the once obscure asset class enters the investment mainstream.

    David Chaplin | 12th Apr 2024 | More
    ‘Incoherence’ stops instos from investing for tomorrow: AustralianSuper, Stanford

    Sweeping technological change can upset the best laid plans of big institutional investors. But the way they deal with it is ad hoc, “hazardous” and distorts how they think a portfolio should behave.

    Lachlan Maddock | 10th Apr 2024 | More
    The ‘moral hazard machines’ that (could) make the market more volatile

    Ruffer expects a sudden reversal in the smooth conditions that investors have enjoyed. The ubiquity of multi-strategy hedge funds, algorithmic market making and 0DTE options might make it much worse.

    Lachlan Maddock | 10th Apr 2024 | More