Magellan Financial Group this morning confirmed it has lost one of its largest institutional investment mandates, UK-based St James’s Place.
After requesting a trading halt on Friday afternoon, Magellan has updated the market to disclose St James’s Place terminated its mandate with Magellan on December 17.
The mandate represents around 12 per cent of Magellan’s annual revenue and will have an impact of around 6 per cent for the financial year ending June 30, 2020, Magellan said this morning.
“The impact will be immaterial on the Group’s interim results to 31 December 2021,” the company said in a statement authorised by the board.
“Magellan would like to thank SJP for its partnership and support over many years.”
On Friday, co-founder Chris Mackay issued a vote of confidence in the beleaguered firm’s chief investment officer Hamish Douglass after the firm went into a trading halt.
In an ASX statement late on Friday, Magellan requested the halt due to “the termination of a material contract”. It follows a sharp decline in the performance of Magellan’s global equities fund and recent leadership instability.
“I’m very supportive of Hamish and the business,” said Mr Mackay who co-founded Magellan with Hamish Douglass in 2006. “Magellan has an amazing talented team and provided we remain client focused and continue to develop our team, Magellan will be resilient and succeed over time.”
Magellan’s chief executive Brett Cairns shocked shareholders and the investment community when he quit unexpectedly this month executive, citing “personal reasons”. Mr Douglass, Magellan’s chief investment officer and executive chairman, also revealed in a statement that he was dealing with some personal matters, after announcing he had separated from his wife.
Magellan shares were halted on Friday afternoon at $29.36.
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