Perpetual finds extra $20m in Pendal synergies

Mike Taylor

Managing Editor/Publisher, Financial Newswire

28 April 2023

Perpetual Limited has defied the market sceptics by pointing to better than expected synergies flowing from its acquisition of Pendal.

In a third quarter update delivered to the Australian Securities Exchange (ASX) today, Perpetual pointed to an increased estimate of net-synergies from $60 million to $80 million which it expected to deliver over the next two years.

It said that in order to achieve the additional $20 million in synergies, there would be a further $30 million in one-off implementation costs expected to be incurred evenly across the program.

In an announcement specifically related to the Pendal acquisition, Perpetual said the company’s immediate focus had been on defining and implementing the operating model for the combined business, noting that the executive committee was in the process of confirming their leadership teams and “implementing regional structures that support a multi-boutique, multi-region operating rhythm”.

It said it expected this process to be largely complete by the end of May.

More broadly, the Perpetual third quarter update represented the first which brought together the Perpetual and Pendal asset management businesses reporting total assets under management (AUM) of $210 billion – an increase of 4% of its pro-forma AUM as at 31 December, last year.

It said that across the group total net flows were close to flat at $0.1 billion in net outflows for the quarter, assisted by strong net inflows for Barrow Hanley “which, for the first time since the acquisition in November 2020, delivered positive net inflows of $0.9 billion over the period”.