Pinnacle Investment Management (PNI) – Going global
PNI hit new all-time highs today as it resumed trading following a capital raise and acquisition of stakes in two US based managers. A positive reaction on the prospect of the successful Australian ‘fund-of-funds’ strategy further expanding globally. Pinnacle announced the investments include:
- US$60.5m to acquire a 22.5% stake in VSS Capital Partners
- £25.75m to acquire a 25% stake in Pacific Asset Management
- A$75m to fund existing affiliate strategies (Coolabah, Hyperion, Spheria, etc.)
- A$182m to support additional growth initiatives
VSS is a U.S based firm specializing in providing capital to fund growth, strategic acquisitions, and buyouts of low to mid-tier companies. Pacific Asset Management on the other hand is a more conventional U.K based asset manager. This isn’t the first venture to either jurisdiction for PNI and probably not the last as they continue to expand their reach. We like the aggressive approach by PNI but think paying 48x earnings for what is mostly a funds management business is on the expensive side.
