Three former money managers with Seamark Asset Management Ltd. are returning to the fold in a bid to turn around the investment firm that has just lost Manulife Financial Corp. as its biggest client.
Halifax-based Seamark, a unit of Matrix Asset Management Inc., has entered into a deal whereby it will acquire the assets of LeeSide Capital Management Inc., co-founded by Robert McKim, George Loughery and Donald Wishart. The trio will replace the Seamark’s current equity team as part of the transaction set to close around March 20.
Manulife, a long-time client of Seamark, said last month it was withdrawing its business – about $450-million, or 24 per cent, of Matrix’s total assets – by June.
“That decision has been made, and it’s not easy to reverse that,” Mr. McKim acknowledged Wednesday in an interview. “We intend to keep them apprised of the progress we have made in the management of the assets of Seamark…I do have a strong history with Manulife, having worked with them on several of their funds when I was at Seamark.”
Under the terms of the deal, LeeSide will receive a non-voting equity interest in Seamark, Matrix’s institutional and high net worth division, that will equal about 35 per cent of the profits of new business generated.
Mr. McKim was a former CEO and chief investment officer at Seamark before he left in 2005 after a 20-year career with that firm. He and his two colleagues, who left later, created LeeSide in 2009 to focus on institutional and high net worth clients.
“We are bringing some assets and our expertise,” he said. “We have a 40-year [combined]history of having worked at Seamark, and we grew assets from $50-million to $10-billion by the time I left.”
Mr. McKim said he left Seamark because “I wasn’t completely on the same page with my board in terms of what we should be doing in terms of how to run the company.”
He would not disclose Seamark’s current assets except to say that it will be about $500-million [including LeeSide’s contribution]after Manulife pulls out its monies.
Seamark’s woes began in 2006 after it lost mutual fund client IA Clarington Investments Inc., which withdrew $3-billion in assets. Over the years, the asset base has eroded partly because of performance problems.
Mr. McKim made a pitch to Seamark founder and Matrix board member Peter Marshall last fall to run money for the firm as an external manager. Instead, Matrix decided that the LeeSide team would be “a viable alternative to the equity team that was there,” Mr. McKim said.