The sad saga of AMP Capital continues
AMP Capital which was once one of New Zealand’s largest managers is about to essentially shut up shop.
Thursday, October 6th 2022, 6:53AM 
4 Comments
The company is planning to transfer its funds to Mercer.
First a bit of history, AMP Capital was a significant active manager in the New Zealand market with its largest client being what is now known as AMP Wealth. When sister company AMP Wealth decided to move from an active investment approach to passive using Blackrock, AMP Capital essentiallty lost its biggest client.
Following that decision AMP Capital was acquired, earlier this year, by Macquarie Asset Management (MAM) as part of deal with head office in Australia.
Now rebranded Macquarie Asset Management, the company had big plans to grow again in New Zealand.
As recently as the Wealthpoint conference in Christchurch, managing director Rebekah Swan talked optimistically of plans to reboot the business in New Zealand
It has now emerged that Mercer will assume legal control of the MAM NZ funds with Macquarie remaining as an investment manager for at least some of the underlying assets.
Those funds are likely to be the local fixed income team which numbers five people. Macquarie will no longer be a licensed manager.
Part of the irony of this deal is Mercer used to be a significant AMP Capital client, but withdrew much of its funds a number of years ago.
It is understood MAM has 34 retail and wholesale funds and, if approved, the transfer will take place in early March next year. It is also understood Resolution Life (formerly AMP Life) is MAM's biggest customer.
Swan, told clients in a note: “We believe this change will offer strategic benefits to clients in the funds, bringing together MAM’s strengths in global investment management and the strength of Mercer’s well-established New Zealand multi-manager platform. Mercer has a significant presence in New Zealand, with a team of 130 people.”
“MAM intends to remain an investment manager for the funds and will retain our local investment management presence in New Zealand,” Swan said.
Macquarie manages around $2.7 billion compared to almost $10 billion at the same time in 2021.
In her note, Swan said Mercer had contacted MAM post completion of the sale of the AMP Capital’s global equity and fixed income (GEFI) business to Macquarie in March this year.
“In undertaking a strategic review of the platform and looking at future opportunities, including growth options, Mercer discussed with us an opportunity to become Manager of the funds,” Swan said.
Swan told delegates at the Wealthpoint conference that the plan was to "stabilise" the business after a couple of "challenging years", and then to move into a growth phase.
She said it was "fantastic that Macquarie saw a lot of value in the AMP Capital business."
As part of the growth plans MAM was looking at its product range, and add some new offerings, notably one of Macquarie's global equity funds.
"We are pretty happy with our current product offering," she said, "but there are some tweaks we can make around the edges."
Swan and head of investment strategy Michael Gray were also due to release a new ESG policy. She said they had taken the Macquarie policy, which was quite general, and created a New Zealand RI philosophy.
She also said MAM in New Zealand could leverage off Macquarie's substantial infrastructure and systems.
MAM clients Good Returns have spoken to have expressed surprise at the move and are still waiting to here what Mercer's plans are for the funds.
One described it as "a shambles" and there are concerns many people would lose their jobs. This comes at a time when a significant number of staff at KiwiWealth are also likely to lose their jobs following the sale of that business to Fisher Funds Management.
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Comments from our readers
Been a pretty consistent downward corporate spiral since then even though they have had some good investment staff...who probably didnt want to buy any AMP shares given their lackluster corporate leadership.
Even then they were well behind industry business trends.
Well said. And one of the architects of this destruction is still been employed by AMP. You couldn't make this stuff up if you tried.
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The demise of the once great AMP will go down as legendary in future textbooks, as will the names of those who presided over it
It’s always difficult to fully understand the true workings of a relationship industry when stuck in an ivory tower counting beans
Macquarie Bank have forged an enviable history (& produced many millionaires) by being canny traders. Whoever believed that they were in for a long time, clearly got drunk on their lolly water
Yep - jobs will go from a bunch of once proud entities including AMP Capital. I’d expect more carnage to follow…