Platinum shares slump on news of $1.4b outflows
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The news: Shares in Platinum Asset Management have slumped after the troubled investment manager flagged a hefty funds outflow late on Tuesday.
The numbers: Platinum said a large institutional client is set to redeem $1.4 billion in mandated funds as part of efforts to rebalance exposure away from benchmark agnostic global equity managers, which would result in around $18 million in lost fees annually.
The news prompted Platinum shares to drop 20.31% to $1.04 in early trading on the ASX on Wednesday.
The context: The outflows come just weeks after Platinum announced a 12-month ‘reset and growth’ turnaround plan under which it plans to reduce costs, review existing product offerings and reorganise its investment platform.
The company said on Tuesday it expects to find at least $25 million in annual savings through cost reductions.
It recently appointed industry veteran Jeff Peters as its new CEO to replace co-founder Andrew Clifford. Platinum shares are down over 40% over the last 12 months, having lost ground amid fund outflows in a competitive market.
The source: ASX announcement
