KBC Group Q&A

KBC ASSET MANAGEMENT TAKE 51% SHAREHOLDING IN LIONTAMER
We are delighted to announce that the asset management arm of Europe's 11th largest bank, KBC Group, have joined Liontamer as shareholders.

This is an enormous moment of progression for Liontamer, as we partner with one of Europe's largest banks and work alongside a highly successful asset management team.

We believe that it is also a significant moment for New Zealand advisers, brokers and investors, who will benefit from one of Europe's leaders in capital protected products bringing their expertise and pricing power to the Liontamer business. Belgian-based KBC have a market cap of 36 billion Euros (NZ$66 billion) and are listed on Euronext Brussels and the Luxembourg Stock Exchange. They operate across Europe and Asia with 11 million customers and over 50,000 employees.

It’s a great achievement for a business like Liontamer to attract such a prestigious international player. KBC’s stake in our business is a powerful endorsement of their confidence in the New Zealand market and in the achievements of Liontamer since our launch in 2003.

What stake have KBC purchased in Liontamer?
51%

When did this occur?
The transaction was completed on 22 May 2007.

Which part of KBC purchased shares in Liontamer?
KBC Asset Management.

Who is KBC Group?
A Belgian based bank with banking, insurance and funds management capability. They are Europe’s 11th largest bank.

How big are KBC?
KBC are spread over Europe as well as Asia, but despite their size (larger than sum total of the NZX 50, New Zealand’s 50 largest companies), they know the magic of small markets. Their own stomping ground of Belgium has a population of 10.3 million, but their structured products industry is the envy of the world. In 2006 total sales of structured products from all providers in the Belgian market was 20.6 billion Euros (NZ $39 billion).

Source www.kbc.com, converted to NZD, www.nzx.com and www.structuredretailproducts.com.

Who are the new board members?
The new board is made up of eight members.  The four new directors are as follows:

Liontamer’s existing directors all remain on the board:

Who has management control?
Liontamer’s existing management team maintains full day to day control of the business.

Will Liontamer keep its brand?
Absolutely - KBC Asset Management are fully behind the Liontamer brand.

What price did KBC pay for the shares?
This is confidential, between the parties and is not disclosed to the public.

What is the size of Liontamer’s funds under management?
Approximately $200 million New Zealand dollars.

Will KBC send any employees to NZ or Australia?
Yes, our first employee is due to arrive in Sydney at the end of July to take up the position of Head of Sales and Structuring, Australia.

What are the benefits from KBC’s involvement?
There are many benefits for Liontamer, our investors and financial advisers/brokers:

Will KBC now provide the capital protection for Liontamer’s funds?
We plan to use KBC’s pricing power and expertise to put together funds. It would also be sensible to get KBC to provide capital protection for our products. This will be phased in over time and will need some careful planning to make sure the protection is structured in the way we require it. We will be liaising with financial advisers and brokers to explain any changes which occur. For now, it is business as usual. We cannot make any changes until we are happy with all the detail behind the scenes.

What are Liontamer’s plans for selling funds in the Australian market?
We are at the final stages of being issued our license by ASIC and this will allow us to sell both structured and actively managed funds in Australia. We have received approval to act as our own Responsible Entity (RE). We hope to have our first fund up and running within the next three months. Our entry into the market will be fairly cautious and considered.

Will Liontamer sell actively managed funds in Australia and New Zealand?
Yes this is a very likely progression for our business. One of the reasons behind our decision to partner with KBC is that we are big believers in investment areas related to world sustainability and macro economic change caused by the way we treat the world’s resources. KBC are one of the world’s leading managers of thematic funds such as Water, Alternative Energy and Climate Change. A partnership with KBC provides us with access to these funds and a platform for further growth and expansion into the Australian market. For financial advisers and brokers, having access to a wider range of international funds will enhance the market.

How did a Belgian Bank come to buy a New Zealand fund manager?
The KBC link: While the KBC name is not immediately recognisable in the New Zealand market, they are very familiar to us here at Liontamer. They’re a very well known name in our industry internationally. We've monitored their funds for years, and have maintained a long-standing relationship with their asset management team. They've acted as mentors on a personal level and given advice on the basis of simply wanting to see a boutique manager succeed. Over the years, we've kept in regular touch via visits to Europe and conference calls to share ideas. So it was no real surprise when KBC first approached us to form a strategic relationship.

The relationship stemmed from our managing director Laetitia Peterson; a Belgian now permanently based in New Zealand. Watching a bank in her home market go from strength to strength, she knew it was important to maintain relationships with organisations who were successful and who would be generous enough to give good advice. There is an important cultural link between Liontamer and KBC – even to the extent that their national flag has a Lion on it and their national song refers to taming Lions!

What are the plans of the original shareholders in Liontamer?
The original shareholders, Laetitia Peterson and Janine Starks, maintain full management control of Liontamer and it is ‘business as usual’. They still own 49% of Liontamer, which is a large stake and are therefore fully committed to the business.

Where can I find out more information about KBC?
www.kbc.com
A very brief history of KBC is as follows:

How active are KBC in the structured products market?

What size is KBC’s Assets Under Management?

Liontamer’s key statistics:

  • Time in the market: Liontamer have just begun their 5th year of business.  We began in early 2003 with our first fund launch in May 2003.
  • Our name: ‘Liontamer’ is a fresh innovative brand and the name expresses what we do – the Lion represents the financial markets which can be volatile and aggressive.  We are ‘taming’ the markets by providing capital protection.
  • Founder: Laetitia Peterson – Belgian born and educated, now living in Auckland New Zealand.  She was voted by New Zealand’s ‘Asset Magazine’ as one of the most influential people in financial services in NZ.  Laetitia has a Bachelor in Commercial Engineering with specialisation in finance, magnum cum laude, from The University of Leuven, Belgium and an MBA from the University of Chicago, USA.  She has won a Wall Street Journal award for outstanding academic achievement and was a Fulbright scholar.
  • Awards: Liontamer has won an award for being one of the most exciting companies in financial services (National Business Review/ Microsoft award).
  • Accolades: one of our greatest achievements is that we were very early pioneers of capital protected commodities funds.  We believe that we were one of the first in the world with a capital protected retail commodities fund.  It attracted a lot of attention and was quickly copied in other markets.  The fund has been a top performer and has more than trebled investors’ savings since its launch in April 2004.
  • Innovation: Liontamer is extremely innovative and offer funds in a wide range of sectors – e.g. Asian equities (Tiger funds), BRICK funds, global booster funds, global brands funds, commodity funds with rainbow features, currency funds, and areas such as gold and Japan.
  • Speed: The business is very nimble and has been able to achieve great speed to market.  Public funds can be launched in 2-4 weeks and customised funds in as little as 1 week.
  • Shareholders: Laetitia Peterson, Managing Director (60%), and Janine Starks, Investment Director (40%).  In those proportions we now own 49% of the business and have full management control for a minimum of 5 years.  KBC own 51%.
  • Size of team: 10 (including the sales team and a new employee from KBC, who will join in July).
  • Investment vehicle used: Australian unit trusts.
  • Markets: currently sell funds in the NZ market and are about to launch into the Australian market.  Currently distribute via Independent Financial Planners, Stockbrokers, Banks, Insurance Companies, and Accountancy firms.
  • Head office: Sydney, Australia.
  • Other bases: Auckland, Wellington and Christchurch, New Zealand (the three largest cities).  Majority of the team are Auckland based. 
  • Number of funds: 21 with 27 different unit classes.
  • Funds under management: over NZ$200 million.
  • Number of investments: approx 10,000 (numbers are approximate as a lot of investments come via wrap accounts as one amount and we have approximated the numbers based on average investment sizes).
  • Number of individual investors: approx 7,000.
  • Repeat buyers: 30% of investors buy more than one fund.


More about the Liontamer team

From left to right: Liontamer’s core team for New Zealand

Note: Matthew Mimms and Chris Smith are part of ‘The Investment Store’ and supply distribution services to Liontamer.  They are a core part of the New Zealand team.

Missing from the picture are our Australian colleagues, Edward Russel (Compliance & Operations Director, Australia) and Jacqui Walshe (Independent Director) and Mike Perry (Head of Finance & Structuring, NZ) who joins us in July.


Shareholders:

Laetitia Peterson: Laetitia is Belgian born and educated; now living in Auckland, New Zealand. She was voted by New Zealand’s ‘Asset Magazine’ as one of the most influential people in financial services in NZ. Laetitia has a Bachelor in Commercial Engineering with specialisation in finance, magnum cum laude, from The University of Leuven, Belgium and an MBA from The University of Chicago, USA. She was a Fulbright scholar and has won a Wall Street Journal award for outstanding academic achievement. She worked for the global investment bank Goldman Sachs in New York and London and was involved helping European banks set up some of the first retail capital protected products in Europe in the early 1990s. In the NZ financial services market she has worked for Fay Richwhite, PricewaterhouseCoopers and the BNZ where she was a Director of Capital Markets and was an early pioneer of capital protected investments.

Janine Starks: Janine is New Zealand born and educated; now living in Christchurch, New Zealand. She has a Bachelor of Commerce from Canterbury University and Financial Planning qualifications from the UK. Janine’s early career started in the wholesale markets with ANZ Bank in their Treasury division. She moved to the UK and began a retail career with Independent Financial Advisory firm, Chase de Vere (voted IFA of the Year and Investment IFA of the Year in Britain). She was closely involved in developing many capital protected offerings for the firm and became a well known independent commentator in the market, regularly quoted in papers such as The Telegraph, Times, Sunday Times, Express, and Mail on Sunday. She was the personal finance expert on the Carlton Television series ‘The Business of Life’ and made appearances on the BBC and radio. Janine moved home from the UK in early 2003 after seeing through the sale of Chase de Vere, to Europe’s Bank of Ireland. She joined Laetitia Peterson as Liontamer emerged.

 






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