Wilson Asset Management is preparing to ride what chairman Geoff Wilson has described as a “golden age” for listed investment companies, as it lists its WAM Global fund on Friday following an oversubscribed $466 million offering.
“There is still a strong demand for global equities and for exposure to global managers,” Mr Wilson told The Australian yesterday. “The last five years have been a golden period for LICs and I would expect that there will be continued growth in the sector.”
The value of ASX-listed pure global equity-focused funds has risen more than 100 per cent in the year to May 31, from $3.39 billion to $6.825bn.
More broadly, the value of the locally listed LIC and listed investment trust sector is up 22 per cent over the same period, from $32bn to $39bn.
“It is very difficult for an individual to invest and get access to high-quality information on global equities. One of the good things is that Australian fund managers have shown that they can add value to global equities,” Mr Wilson said.
In a record raise for the company, WAM Global’s IPO attracted 12,855 investors, 8000 of which were existing shareholders of Wilson Asset Management companies, and well exceeded its initial $330m target.
It precedes the firm’s first foray into managing money with a focus on global equities. WAM Global is set to concentrate on undervalued international growth companies with a bias to small-to-medium sized entities.
The fund will invest with the same process as WAM’s other six ASX-listed funds, which Mr Wilson said had been well proven in Australia over the past 20 years, but he said WAM was waiting on the right team to make its global equity debut.
Catriona Burns will head the global portfolio after rejoining the group earlier this year following her stint with WAM from 2003 to 2007.
Mr Wilson said: “We have had people asking us to explore globally for years; we have always had the process but we were waiting for Catriona to come back to join us.
“We will only buy when we can see a catalyst or an event that is going to change the valuation, and will sit in cash if we can’t find one of those opportunities.”
Wilson Asset Management invests more than $3bn on behalf of more than 55,000 retail investors.
The latest raise surpasses Wilson’s $394m raise for the launch of its WAM Leaders (WLE) fund in 2016.
Mr Wilson described Australian fund managers as some of the best in the business, tipping his hat to other global LICs Magellan Financial Group and Platinum Asset Management.
At its float last October, Magellan raised $1.5bn.
“We look forward to providing WAM Global shareholders with exposure to a high-quality portfolio of undervalued international growth companies using our proven investment process, which has delivered solid risk-adjusted returns for more than 20 years,” Mr Wilson said.