GQG reassures analysts over Goldman Sachs tie-up

afr.com:

ASX-listed global equities’ manager GQG Partners has reassured the market that a key tie-up with Goldman Sachs is sound, as it delivered another half of revenue growth, defying broader weakness in the funds management sector.

The Florida-based asset manager said its funds under management increased $US6.1 billion ($9.6 billion) over the June half to $US104.1 billion bucking an industry trend of shrinking assets and profits.

GQG Partners co-founder Rajiv Jain Benjamin Rusnak

A 6.5 per cent increase in interim revenue to $US237.1 million ($369 million) beat analyst forecasts, helped by an increase in average management fees from 47.6 basis points to 48.3 basis points.

The result also revealed that GQG is attracting substantial inflows from United States investors, a big share of which are via a sub-advisory arrangement with Goldman Sachs Asset Management.

The research arm of Goldman Sachs, which is separate to asset management, said this tie-up now accounted for around $US29 billion, or 28 per cent of total GQG funds.

GQG chief executive Tim Carver told analysts he was “very confident that the relationship remains strong,” amid reports of staff cuts at the investment bank. “This is not only a very good relationship for us, but it’s one of the most important funds for Goldman as well in their lineup, and across their whole business,” Mr Carver said.

GQG Partners remained tight-lipped about its apparent interest in Pacific Current, the ASX-listed backer of boutique fund managers that owns 4 per cent of GQG.

In late July, Phil King’s Regal Partners lobbed a bid that valued Pacific Current at about $600 million. Regal also said that if its bid was accepted, it would distribute the GQG component valued at $200 million to