After taking over Gallet Employee Benefits this week, Sygnia Asset Management still has more than R150m in cash for acquisitions and further investments
After taking over Gallet Employee Benefits this week, Sygnia still has more than R150m in cash for acquisitions and further investments.
Word is that it acquired Gallet, which has R5bn in assets under advice and administration, for less than R50m. Before the Gallet deal Sygnia had about R200m in capital for growth.
At the end of December Sygnia had R146bn in assets under management, against R137bn in September.
The acquisition, its first since listing on the JSE in October, will allow Sygnia to pursue its “ambitions to launch an innovative, market-disrupting umbrella fund much more quickly than anticipated,” says Sygnia CE Magda Wierzycka.
Gallet is an umbrella fund consultant and administrator of the Setshaba Pension and Provident Funds, among others.
On the other hand, Sygnia administers assets on behalf of more than 600 domestic and international institutional clients, and over 6,000 individual clients.
An umbrella fund is a scheme set up to provide retirement, death and other benefits to members of a participating employer.
The key to the success of umbrella funds is technology and automation, says Wierzycka, adding that technology is one of Sygnia’s “recognised strengths and we will use it to build the Sygnia Umbrella Retirement Fund into a meaningful player in the retirement fund industry”.
Priorities include investing in technology and starting an online financial planning tool to advise technology-savvy clients.
“What we are launching in March is our robo-adviser model. It’s a do-it-yourself financial planning tool. The system will recommend an investment strategy,” she says.
“We envisage that the stand-alone retirement fund market will continue to consolidate into umbrella funds as the regulatory requirements become increasingly costly and onerous to implement,” says Wierzycka.