Anton Tagliaferro

Investors Mutual’s new LIC, QV Equities Limited, has raised over  $180m from  Australian and New Zealand investors, making it one of the most successful raisings ever for an Australian equities LIC.

Last month IML launched QVE to the market with the aim of providing self managed super funds, high net worth individuals and other investors with a diversified portfolio of quality companies outside the top 20 stocks in the ASX 300. The IPO closed on last Friday (8 August).

Wayne McGauley, IML’s Head of Retail, said QVE resonated strongly with many advisers and investors who viewed the LIC as a solid long- term investment.

“We’ve spoken to literally thousands of advisers and clients in the last few weeks, reinforcing the diversification advantages of investing in Australian companies outside the ASX top 20. We are very pleased with the response and to have raised such a significant amount from investors around Australia, particularly given the current uncertainty in share markets.”

IML now has up to six months to invest the money raised and to build a portfolio of good quality companies that it believes will perform well in the long term.

IML founder and Investment Director, Anton Tagliaferro said now that the money had successfully been raised, it will be invested in the same cautious and disciplined way as all of IML’s client monies had been since 1998.

 “In our view, there are many quality companies in the ex 20 sector of the market that fulfill our criteria of strong competitive advantage , recurring and predictable earnings streams run by capable management teams that will provide sound long term investments as they grow their earnings and dividends over time. We believe the recent volatility in the share market as a result of geopolitical uncertainties as well as speculation as to when the US Fed may raise interest rates may provide some good opportunities for us to invest the money wisely in the next few months.”

“We’d like to thank lead arranger CBA Equities, led by Geoff Carrick Head of ECM and Trevor Franz Head of Syndicate who were very thorough and  provided professional advice throughout – they  truly have become one of  Australia’s leading ECM teams,” Mr Tagliaferro said.

Don Stammer, Chairman of QV Equities added, “I am delighted by the significant capital raised and the large number of shareholders who subscribed to shares in the company. Going forward, we are all focused on working hard to ensure that our shareholders enjoy the medium to longer term benefits that a quality portfolio of ex 20 stocks will provide .”

The issue was arranged through CBA Equities who were also one of the joint lead managers to the issue along with BBY, Patterson and Taylor Collison and co manager Lonsec Securities.

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PM CAPITAL has raised $225 million across two IPO’s since November 2013. The second IPO was targeted at investors looking for specific global exposure in the Asian region, and raised $54 million across 1,325 investors, varying in size.

Chairman of the PAF, Brett Spork, said the listing is reflective of a growing investor appetite for Australian investors wanting to diversify offshore and further recognising that Australian stocks which previously exposed investors to the Asian growth story, may no longer be a viable proxy.

“Investors are realising that in order to get exposure to Asia, they need to look beyond BHP and RIO, and really exploit where the growth opportunities in the Asian Pacific region will be over the next decade- the 4 billion evolving consumers who are growing in affluence”.

Chris Donohoe, CEO of PM CAPITAL, said the global LICs were attractive as the consensus from brokers was that the LIC structure appealed to SMSF investors, who require greater diversification to offshore equities.
“While there are numerous competing Australian LICs, the number of globally focused LICs is minimal, and the timing was ideal with the Australian dollar at elevated levels”.

Donohoe thanked the brokers involved in the raising, who contributed to the majority of the capital raised.
“We specifically thank Ord Minnett, Taylor Collison, CBA Equities and Morgans for their support of helping raise $54,203,942 across 1,325 shareholders. The stapled price of combined Shares and Options commenced trading today at $1.06”.

“While we had almost 500 financial planners across the country attend our roadshow, the vast majority of the capital raised came form the brokers. We expect planners to access the opportunity through their more traditional methods, which is why we have the products available on major platforms like Colonial First State and Macquarie Wrap”.

PM CAPITAL is a Sydney based specialist equity and income fund manager that was founded in 1998 and manages $1.7 billion in funds under management (as at 30 April 2014). The firm is owner-operated and has a long-term track record of managing equity portfolios. The investment process is a research-intensive, bottom-up approach that results in the portfolio holding high conviction positions in companies that are assessed to be trading below their long term intrinsic value.

The Company’s proposed investment mandate has been based on the guidelines of the PM CAPITAL Emerging Asia Fund (EAF), which has achieved a total return of 188.9%, since its inception in 2008, which compares favourably against the MSCI Asia (ex Japan) Equity Index (Net Dividends Reinvested, AUD) total return of 16.6% (as at 30 April 2014).

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