Chris Mackay selling 6.6pc stake in Magellan; Barrenjoey on ticket

afr.com:

Barrenjoey’s equities desk was late on Wednesday looking for buyers for some $112 million in Magellan Financial shares being offloaded by the fund manager’s co-founder, Chris Mackay.

The 12 million shares were being offered at $9.40 apiece or a slim 3.1 per cent discount to Wednesday’s close. Mackay’s vehicle, Magellan Equities, was listed as the seller. It held 15.3 million shares or 8.42 per cent of the company before Wednesday evening’s trade. The transaction was structured as a fixed-price book build and mopped up pretty quick.

Magellan co-founder Chris Mackay last year. 

It is the latest turn in a wild ride for Magellan ever since its other co-founder, Hamish Douglass, quit the firm in March last year after taking a medical leave of absence following the dissolution of his marriage. In November, he sold two-thirds of his shares in a block trade via Barrenjoey at $9.10 – at the time a 5.5 per cent discount to the closing price. The sale, through his Midas Touch Investments vehicle, was worth $118.3 million

The latest transaction comes after Magellan posted a 57 per cent fall in profit to $401 million and a 35 per cent decline in its funds under management last week. It paid a 30¢ extra dividend.

But there is a broader shake-up. Having stabilised the company and brought in new management and investment staff, Hamish McLennan is handing over the chairmanship of the fund manager to ex-Janus Henderson co-chief executive Andrew Formica. McLennan will stay on as deputy chairman.

The group guided for expenses in this financial year to come in between $95 million and $100 million, down from $121.3 million as it adjusts to its falling funds under management. It had no debt and cash of $373.4 million.