Perpetual’s D’Aloisio faces re-election hurdle after sour Pendal deal

afr.com:

Perpetual chairman Tony D’Aloisio faces a challenge to his re-election to the fund management group’s board after influential proxy advisory Ownership Matters recommended shareholders vote against it.

Mr D’Aloisio, a former Australian Securities and Investments Commission chairman, has chaired the company since 2017 and was last reappointed in 2020. If elected at the annual meeting this month, this will be his final term.

In its advice to investors, Ownership Matters also recommends against approving the remuneration report or the re-election of Fiona Trafford-Walker, chair of the board committee overseeing the integration of Pendal, another major fund management group, into Perpetual.

Perpetual chairman Tony D’Aloisio, pictured back in 2011. Lee Besford

Perpetual completed the $2 billion acquisition of Pendal – Westpac’s former funds management arm, which was first spun out of the bank in 2007 as BT Investment Management – in January. But it has not been a smooth deal, with integration costs rising from $110 million to $140 million. Perpetual has also shut down several funds and parted ways with Pendal’s head of global equities, Ashley Pittard, as well as other portfolio managers.

Among Ownership Matters’ concerns, according to its report, is what it contends was a poorly conceived transaction document that precluded Perpetual calling off the Pendal acquisition when Regal Partners approached the company with a bid to acquire it at $33 per share. The matter ended up in the Supreme Court of NSW, which found Perpetual would have to pay a $23 million break fee to Pendal and would be liable to pay its rival additional penalties if it walked away from the deal.

Perpetual shares last traded at $20.95, a far cry from Regal’s