Macquarie buys 49% of Brook

Macquarie Bank subsidiary Macquarie Investment Management New Zelaand has acquired a 49% stake in Brook Asset Management for an undisclosed sum.

Monday, December 20th 2004, 10:52PM

by Jenny Ruth

John Rowley of Macquarie says his bank has wanted to establish a funds management business in New Zeland for some time.

"It’s really difficult to start from scratch" and buying into an existing business was a good option.

"It’s just perfect for us. We want to be associated with the best people in the market. They (the Brook team) are clearly at the top end of the market," Rowley says.

Macquarie brings its name and distribution capabilities to the partnership, he says.

The bank doesn’t want to control Brook and won’t be interfering with the way it is run.

"From their clients point of view, it’s important that their independence is maintained."

Brook’s client base, which includes the New Zealand Superannuation Fund, is "exceptional," Rowley says. One of the advantages of working in a small market like New Zealand is that everybody knows each other and he has known a number of the key Brook people for many years, he says.

"We have a respect for each other which makes it a much easier merger to put together."

Last week, Macquarie bought PricewaterhouseCoopers New Zealand financial planning business which brought its team of advisers in this country to 36.

Macquarie will have two seats on Brook’s five-person board. Current chairman George Kerr is stepping down and will be replaced by Simon Botherway, Brook’s chief investment officer. Brook and other senior executives own the other 51% of the company.

Botherway says a major attraction in joining forces with Macquarie is the bank’s expertise in product manufacturing.

"Our vision is, over time, to broaden the business offerings beyond our current range of products to include a couple of other categories including infrastructure," he says.

Accessing support services, including legal advice and insurance, through Macquarie should also provide Brook with better terms, he says. Brook, which evolved out of Arcus Investment Management two-and-a-half years ago, has about $800 million in funds under management. It manages funds for AXA and Spicers.

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