Ausbil shuts $27M fund as Firmus investment draws internal scrutiny
What's the deal? AusbilDealroom has a profile for this one. Try Dealroom → has closed its $27 million long-short focus fund, with chief executive Mark Knight announcing the move last week. The closure cost the jobs of deputy head of equities Gian Pandit and co-portfolio manager Chris Smith, who was also the firm's head of research.
What led to it? The fund's fundraising fell short, prompting a strategy reshuffle. It follows other recent exits: small-cap specialist Tom Cutler left for Ophir Asset ManagementDealroom has a profile for this one. Try Dealroom →, and portfolio manager Andrew Peros joined L1 CapitalDealroom has a profile for this one. Try Dealroom → in August.
Why the scrutiny? Attention has turned to a pre-IPO investment in Firmus, a data centre company, made both by Ausbil and personally by chief investment officer Paul Xiradis. Personal stakes like this draw questions from conflict-averse fund managers, who typically route their own money into funds they manage.
What's the valuation problem? Firmus sits largely in Ausbil's flagship Australian Active Equity Fund, which Xiradis manages and which is almost entirely listed blue-chip stocks — making the unlisted Firmus an outlier. The fund's disclosure statement permits investments in "unlisted companies which are expected to be listed." Firmus's abandoned October float leaves no market price to mark against.
What's the link? Some in the fund management community speculate the personnel moves tie back to internal discussions over Xiradis's Firmus holding and its disclosure, with queries reportedly reaching parent company New York LifeDealroom has a profile for this one. Try Dealroom →. Any direct connection between the closures and the investment remains speculation.
The signal: Firmus's scrapped float — which had targeted a roughly US$28.5B valuation — has become a disclosure test for its backers. With the Australian Securities and Investments Commission making preliminary inquiries into whether investors received accurate demand information, firms holding unlisted Firmus stakes now face pressure to prove their numbers hold up.
Read more: finnewsnetwork.com.au
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