Aus & NZ: TIF likely to choose new manager in April

23 March 2018 - 12:00 am UTC

The AUD 2.4bn (USD 1.85bn) The Infrastructure Fund (TIF) is expected to decide on a new manager by the end of April, Inframation understands.

Several sources familiar with the matter said shortlisted candidates for Utilities Trust of Australia’s mandate were asked to bid. These include Macquarie, Palisade, IFM Investors, HRL Morrison and QIC. StepStone is also understood to be in the mix.

QIC is thought to have declined due to conflicts with its existing funds.

Among its services, StepStone’s Infrastructure and Real Assets division helps funds assess and make direct investments as well as assisting them to replace their manager.

Inframation understands that a final decision on the exact structure of the mandate is unlikely to be made before the end of April. Then a unitholder vote would be required.

TIF has been considering several options for managing the fund since its unitholders had voted to oust Hastings Funds Management as its manager last August.

At the time it cited a need for greater “transparency” in how its funds were invested and to better align the fund managers with the unitholders as well as a desire to reduce fees.

Investment consultant JANA has been helping examine the alternatives, which are understood to have been wide ranging in their search for a new model.

As well as seeking bids from external managers, the assessment has included whether or not to hire an established group of professionals for internal management or for TIF to be folded into an established fund manager.

It is thought an external manager may be more likely, however, as some of the unitholders are not ready for internal management.

TIF’s investments include: Sydney Desalination Plant, Port of Newcastle, New South Wales Land and Property Information Service, ElectraNet and Porterbrook in the UK. 

UTA also hold stakes in many of these assets. The Trust​​​​​ chose HRL Morrison as its new manager in February. It had issued a tender in early December for a new manager following the announcement of a plan to sell Hastings to Northill Capital.

The Infrastructure Fund declined to comment.

TIF