Platinum Asset Management | Kerr Neilson | Hedge Fund Notes

Platinum Asset Management

Platinum Asset Management | Hedge Fund Notes

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Resource #1: (5.27.07) Platinum is more expensive than gold and on the stock market today, Platinum Asset Management is more expensive than any other asset in its class.

It is the boutique funds management business that listed yesterday at an 80 per cent premium to its issue price making the company's founder and managing director Kerr Neilson an overnight multi-billionaire. And Platinum's stellar performance is encouraging a string of other wealth management businesses to consider a public float, as Emma Alberici reports.

EMMA ALBERICI: Even the company's founder can't believe just how far platinum's shares have run. source

Resource #2: AUSTRALIA'S answer to Warren Buffett is the renowned stock picker Kerr Neilson, who yesterday emerged with a fortune worth $3 billion after floating just a quarter of his funds management business.

Shares in the highly sought-after Platinum Asset Management shot as high as $9.11 yesterday before closing at $8.80, a staggering 76 per cent premium to the $5 they were sold for through an initial public offer.

The IPO was more than five times oversubscribed and no institutions were allowed to buy into the float, thereby creating pent-up demand for the stock. source

Resource #3 Wikipedia Notes: Born in South Africa, Neilson began his career in stockbroking in London. He moved back to South Africa with Banker's Trust, before arriving in Australia in 1984. In 1994 Neilson founded the Platinum Asset Management fund of which today he is the Portfolio manager and chief investment officer. Platinum Asset Management specialises in international equities and manages around A$22 billion. Platinum Asset Management floated on the Australian Stock Exchange in 2007. Neilson's personal wealth is estimated by The Australian Financial Review at $3.5 billion making him one of Australia's richest men.

Neilson is often referred to as "Australia's answer to Warren Buffett" for his ability to consistently select high-performing stocks for his funds management business. Neilson typically avoids 'fashionable stocks', instead investing in "good companies, relatively cheaply, over the long term".

Resource #4 (6.6.07): Kerr Neilson, manager of the biggest international equity fund in Australia, says he does not care about short-term returns or the latest top stocks. That is probably a good thing, because the fund is underperforming this year.
For the Platinum International Fund, which manages assets worth 9.5 billion Australian dollars, or $7.9 billion, Neilson is buying shares of some of the world's biggest companies, including Microsoft and International Paper.

Since it began 12 years ago, the fund has returned more than twice the Morgan Stanley Capital International world index. That performance has lured investors including George Soros to Neilson's funds. They have piled an average of 2.5 billion dollars into the company's international funds in each of the past three years, even as Platinum International lagged behind its benchmark over the period. source

Resource #5: Platinum Asset Management Limited (PTM) has listed on the ASX. The reason was to provide staff with the opportunity to realise part of their interest in the company as well as have a market-made reference price for their future endeavors.

The portfolio managers are Kerr Neilson, Andrew Clifford, Jim Simpson, Toby Harrop, Simon Trevett, Alex Barbi and Jacob Mitchell.

The portfolio managers are supported by analysts who do not have responsibility for a particular portfolio but who are typically responsible for two global sectors (except Japan). The analysts have varying backgrounds and qualifications including law, medicine, science, engineering and IT.

Kerr Neilson has over 30 years of experience in financial markets both in broking and funds management. This involved a period in London, followed by managing the research department for a stockbroker in South Africa. Upon migrating to Australia, he joined Bankers Trust, where he made important contributions to the development of that company’s highly successful retail funds management division. Kerr left Bankers Trust as an Executive Vice President to form Platinum Asset Management in February 1994. He is the Managing Director and the Chief Investment Officer. source

Resource #6 (5.7.07) For a man who has just made $2.8 billion, Kerr Neilson leads a simple life. He walks to work across the Sydney Harbour Bridge - briskly to get the exercise he wants, runs up stairs or occasionally slips into the surf with a boogie board.
"He's a low-key kinda guy, just like a lot of those South African money managers are," an observer says. "They've got the money - they just don't flash it."

Neilson was a rich man well before this week's float of Platinum Asset Management, worth at least $500 million according to BRW magazine, after a working lifetime in financial markets that began 40 years ago in South Africa and included stints in funds management in London, before he arrived in Australia.

He's also tenacious, determined and independent, with skills to run a $22 billion business which are virtually unique here. There are more than 100 boutique fund managers in Australia, with no more than a dozen or so that have built assets under management above the critical $1billion where real profits start. source


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