Regal Partners Limited · ASX:RPL
Regal Partners — Investor Presentation (September 2022)
50 slides from Regal Partners's investor presentation, Sep 5, 2022
Slide 1: Entitlement Offer to accelerate growth
Regal Partners Limited (ASX:RPL) Entitlement Offer to accelerate growth September 2022
Slide 2: Important notice
Important notice This presentation has been prepared by Regal Partners Limited (ABN 33 129 188 450) (“RPL”,”Issuer"). It is a presentation of general background information about the Issuer’s activities current at the date of this presentation, which may be subject to change. The information is in a
Slide 3: Disclaimer
Disclaimer To the maximum extent permitted by law, the Issuer, the Lead Arranger and its affiliates and related bodies corporate and each of their respective directors, officers, partners, employees, agents and advisers (together, the “Beneficiaries”) exclude and expressly disclaim: • all duty and l
Slide 4: Introducing Regal Partners Limited
Introducing Regal Partners Limited (ASX:RPL)1 Regal Partners Limited is an ASX-listed, specialist alternative investment manager with over A$5.0 RPL $601m billion in funds under management. >$5.0bn • Regal Partners (ASX:RPL) was formed on 3 June 2022, following Funds Under ASX ticker Market capitali
Slide 5: Overview
Overview • Regal Partners Limited (“Regal Partners”, “RPL”, “the Company”) was formed following the merger of privately owned Regal Funds Management and ASX-listed VGI Partners Limited, with the aim of being the market-leading provider of alternative investment strategies in Australia • On 23 August
Slide 6: Five key takeaways
Five key takeaways Regal Partners Limited is a specialist, diversified alternatives investment management business: 1. managing over $5.0 billion1 in FUM across Long/Short Equities, Private Markets, Real and Natural Assets and Capital Solutions, on behalf of institutional, family office, charitable
Slide 7: Exceptional investment capabilities across a range of alternative asset classes
Exceptional investment capabilities across a range of alternative asset classes Regal Funds is a multi- VGI Partners Limited is a Kilter Rural2 offers private Attunga Capital2 offers award winning specialist global, high conviction market exposure to private market exposure to alternatives investmen
Slide 8: Regal Partners – An established platform for continued growth
Regal Partners – An established platform for continued growth Well diversified across asset class, liquidity profile and client type – FUM as at 30 June 2022 FUM BY ASSET STRATEGY FUM BY FUND LIQUIDITY FUM BY CLIENT CHANNEL1 Capital solutions, 1% Institutional & other, 6% Daily, 13% Real and natural
Slide 9: Well positioned for growth through the cycle
Well positioned for growth through the cycle Diversified, scalable and growing Attractive market Strong business platform tailwinds economics • Well diversified across types of clients, skew • Increasing investor appetite for • Attractive management fee margins to high-value wholesale investors, HNW
Slide 10: Multiple opportunities for growth
Multiple opportunities for growth 1. 2. 3. 4. 5. Maintain current Seed new strategies Continue investment Inorganic growth Attract & retain the fundraising momentum / partnerships in distribution opportunities best talent • Continue to grow and scale • Seek to hire or partner with • Addition of offs
Slide 11: Use of proceeds and impact of the Entitlement Offer
Use of proceeds and impact of the Entitlement Offer The Entitlement Offer is expected to build surplus capital for the combined business and provide balance sheet capacity to help accelerate multiple growth initiatives Funds are expected to be used as follows: • Continuing to grow and scale existing
Slide 12: Details of the Entitlement Offer
Details of the Entitlement Offer RPL1 is undertaking a 1 for 5 pro-rata accelerated non-renounceable entitlement offer with a retail shortfall placement (“Entitlement Offer”) to existing eligible shareholders Entitlement Offer seeking to raise up to $110m size and structure The Company is seeking to
Slide 13: Details of the Entitlement Offer
Details of the Entitlement Offer Record date Wednesday 7 September 2022 (7.00pm AEST) Barrenjoey Markets Pty Ltd is acting as Financial Advisor and Lead Arranger on the Entitlement Offer. The Entitlement Offer is not underwritten1 Lead Arranger and Bell Potter Securities Limited, E&P Corporate Advis
Slide 14: Indicative timetable
Indicative timetable Milestone Key date Trading halt, announcement of Entitlement Offer Monday 5 September Monday 5 September – Institutional Entitlement Offer bookbuild Tuesday 6 September Announcement of results of Institutional Entitlement Offer Wednesday 7 September RPL shares recommence trading
Slide 15: Appendix A – Additional information on RPL
Appendix A – Additional information on RPL
Slide 16: Contents
Contents Page Section Page 17 Section 1: 1H22 Highlights and merger update Page 22 Section 2: Introducing Regal Funds Management Page 29 Section 3: Financials 16
Slide 17: 1. 1H22 Highlights and merger update
1. 1H22 Highlights and merger update
Slide 18: 1H22 Highlights (six months to 30 June 2022)
1H22 Highlights (six months to 30 June 2022) Merger • Merger between VGI Partners Limited (VGI Partners) and Regal Funds Management Pty Limited (RFM) completed on 3 June 2022 • Merged group named Regal Partners Limited (ASX ticker: RPL) • Creates a leading provider of alternative investment strategi
Slide 19: Merger update
Merger update • Integration and collaboration between teams progressing well. Management • New RPL branding and website launched; marketing and distribution being led by Regal Funds Management. and operations • Transitioning to one dealing and risk management system. • Work underway on building and
Slide 20: Experienced and high calibre team
Experienced and high calibre team Board with a deep bench of experience Michael Cole AM Sarah Dulhunty Jaye Gardner Ian Gibson David Jones AM Brendan O’Connor Independent Chair Independent NED Independent NED Executive Director Non-Executive Director CEO & Managing Director Supported by an experienc
Slide 21: Regal Funds is a highly awarded alternatives manager
Regal Funds is a highly awarded alternatives manager REGAL FUNDS MANAGEMENT INDIVIDUAL STRATEGIES AWARDED Market Neutral Australian Long Short Australian Small Emerging Companies Regal Investment Kilter Rural Strategy Equity Strategy Companies Strategy Strategy Fund (ASX:RF1) Finalist, Best Single F
Slide 22: 2. Introducing Regal Funds Management
2. Introducing Regal Funds Management
Slide 23: Introducing Regal Funds Management (RFM)
Introducing Regal Funds Management (RFM) A history of growth and leading performance since 2004 RFM is a specialist alternatives investment manager, pioneering the hedge fund, private market and alternatives industry in Australia since 2004 FUNDS UNDER MANAGEMENT1 • Multi-award winning asset managem
Slide 24: Regal Funds Management
Regal Funds Management Strong momentum in FUM Growth: CAGR +23% over last 5 years $3,174m June 2017 June 2022 3,500 3,000 INVESTMENT 5 13 x2.6 STRATEGIES 2,500 2.8x IN 5 YEARS 2,000 INVESTMENT 1,500 PROFESSIONALS 19 40 x2.1 $1,116m 1,000 500 ASSET CLASSES 2 4 x4 0 30-Jun-17 30-Jun-22 Long/short equi
Slide 25: Regal Funds Management performance
Regal Funds Management performance Fund performance since inception1 Fund (as at 30 June 2022) Launch year Since inception p.a. Fund (as at 30 June 2022) Launch year Since inception p.a. Long/short equities (unlisted) Private markets Regal Atlantic Absolute Return Fund 2004 23.8% Regal Emerging Comp
Slide 26: Regal Funds Management
Regal Funds Management Well diversified across asset class and liquidity profile FUM BY ASSET STRATEGY FUM BY FUND LIQUIDITY Capital solutions, 2% Daily, 16% Real & natural assets, 12% Term and closed- end capital, 29% Private markets, Monthly, 21% 26% Long/short equities, 59% Quarterly & semi- annu
Slide 27: Regal Funds Management
Regal Funds Management Favourable client mix and distribution channels FUM BY CLIENT CHANNEL Institutional & other, 8% >40% Of client relationships held Closed end capital/retail, 21% directly HNW/family office, 22% Internal & philanthropic, 25% <5% No external client with greater than 5% of FUM Adv
Slide 28: Regal Funds Management
Regal Funds Management FY22 – A transformational year • Over $700m in Net Flows in the 12 months to 30 June 20221 • Successful completion of Capital Raise for ASX-listed investment trust, the Regal Investment Fund (ASX:RF1) • Over $200m raised via oversubscribed Wholesale Placement and 1:3 Entitleme
Slide 29: 3. Financials
3. Financials
Slide 30: Pro forma normalised profit or loss statement
Pro forma normalised profit or loss statement 6 months to 6 months to 6 months to 12 months to Jun 2021 Dec 2021 Jun 2022 Jun 2022 (1H21)1 (2H21) (1H22) $m Average FUM ($bn)2 5.8 6.0 5.6 5.8 • The statutory results have been accounted for under the Average management fee (%) 1.28% 1.18% 1.20% 1.19%
Slide 31: Pro forma group FUM
Pro forma group FUM Movements over last 12 months Investment Investment 30 Jun 20211 Net flows Other3 31 Dec 20211 Net flows Other3 30 Jun 20221 performance2 performance2 $bn Investment business4 Regal Funds Management 2.6 0.6 0.5 0.1 3.8 0.2 (0.7) (0.0) 3.2 VGI Partners 3.2 (0.3) (0.3) (0.1) 2.5 (0
Slide 32: Statutory balance sheet
Statutory balance sheet 30 June 2022 • Robust and liquid balance sheet; no debt; surplus capital of approximately $50m primarily represented by $m Group seed capital in listed funds (VG1 and VG8) and Regal Funds Management (RFM) unlisted funds Cash and cash equivalents 47.2 • No interim dividend, no
Slide 33: Reconciliation of statutory to pro forma normalised NPAT
Reconciliation of statutory to pro forma normalised NPAT 6 months to 6 months to • The statutory results for the half year ended 30 June 2022 have Jun 2021 Jun 2022 been presented to reflect Regal Funds Management for the (1H21) (1H22) period from 1 January 2022 to 3 June 2022, and the newly formed
Slide 34: Appendix B – General and specific risks
Appendix B – General and specific risks
Slide 35: General and specific risks
General and specific risks Summary This section discusses some of the risks associated with an investment in Regal Partners Limited (“Company” or “Regal”, and together with its subsidiaries, the “Group”). “Regal Funds” means any funds, mandates, managed accounts, collective investment vehicles and l
Slide 36: General and specific risks
General and specific risks 1.3 Loss of key personnel The Company’s success is dependent on the efforts of a number of key investment professionals, including Philip King, Rob Luciano and key portfolio managers. The Company relies on its ability to attract, train and retain high quality employees and
Slide 37: General and specific risks
General and specific risks 1.8 Risk in deploying proceeds of the offer The Company expects to use funds raised from the Entitlement Offer to, amongst other uses, continue to grow and scale existing strategies and seed new strategies, such as the Regal Private Credit Opportunities Fund and the Resour
Slide 38: General and specific risks
General and specific risks (d) Derivatives Derivatives, such as options, warrants, futures and swaps, may be used by Regal Funds for hedging and non-hedging purposes. The risks of using derivatives might include: the value of the derivative failing to move in line with the underlying asset, potentia
Slide 39: General and specific risks
General and specific risks 1.12 Information technology systems and internal processes The Company relies on proprietary systems and third party products and services for its management of its information technology systems and has a range of critical internal processes. Any damage or interruptions f
Slide 40: General and specific risks
General and specific risks 1.15 Regulatory and compliance risk The Group conducts its business in a highly regulated industry and must comply with the requirements of Australian Financial Services Licences, the Corporations Act, ASIC, ASX, the United States Securities and Exchange Commission and oth
Slide 41: General and specific risks
General and specific risks 2. General risks 2.1 Economic conditions and other global or national issues General economic conditions, laws relating to taxation, new legislation, trade barriers, movements in interest and inflation rates, current exchange controls and rates, national and international
Slide 42: General and specific risks
General and specific risks 2.4 Climate change risks The main climate change risks are associated with changes in the frequency, intensity, spatial extent, duration, and timing of weather and climate events and conditions. Potential effects, such as those related to flooding, droughts, forest fires,
Slide 43: General and specific risks
General and specific risks 2.9 Force Majeure In addition to the COVID-19 pandemic risks, events may occur within or outside Australia that could have an adverse effect on the global economies and the Company’s share price. The events include hostilities (including the recent events involving Russia
Slide 44: Appendix C – International Offer Jurisdictions
Appendix C – International Offer Jurisdictions
Slide 45: International Offer Jurisdictions
International Offer Jurisdictions This document does not constitute an offer of new ordinary shares ("New Shares") of the Company in any jurisdiction in which it would be unlawful. In particular, this document may not be distributed to any person, and the New Shares may not be offered or sold, in an
Slide 46: International Offer Jurisdictions
International Offer Jurisdictions Singapore This document and any other materials relating to the New Shares have not been, and will not be, lodged or registered as a prospectus in Singapore with the Monetary Authority of Singapore. Accordingly, this document and any other document or materials in c
Slide 47: Appendix D – Summary of the OMA
Appendix D – Summary of the OMA
Slide 48: Summary of the Offer Management Agreement
Summary of the Offer Management Agreement Barrenjoey Markets Pty Limited (ABN 66 636 976 059) (“Lead Arranger”) is acting as Lead Arranger of the Entitlement Offer. The Company has entered into an offer management agreement with the Lead Arranger in respect of the Entitlement Offer (“Offer Managemen
Slide 49: Summary of the Offer Management Agreement
Summary of the Offer Management Agreement • there is an event or occurrence of any government authority which makes it illegal for the Lead Arranger to satisfy an obligation under the Offer Management Agreement, or market or promote the Entitlement Offer (or any part of it); • any regulatory body co
Slide 50: Summary of the Offer Management Agreement
Summary of the Offer Management Agreement • there is introduced, or there is a public announcement of a proposal to introduce, into the Parliament of Australia or any State of Australia a new law, or the Reserve Bank of Australia or any Commonwealth or State authority including Takeovers Panel and A
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