Danish asset manager lands Australian mandate worth DKK 6.8 billion

The Danish money manager C Worldwide continues to attract interest from Australia. The Danish asset manager has just landed an Australian mandate worth DKK 6.8 billion.
Bo Knudsen is CEO of C Worldwide and Managing Director of Global Equities. | Photo: PR
Bo Knudsen is CEO of C Worldwide and Managing Director of Global Equities. | Photo: PR

With just one move, the total wealth under management at C Worldwide has grown by DKK 6.8 billion (EUR 914 million). The money comes from one unnamed Australian client, and the whole amount went into C Worldwide's global equity portfolio in March.

C Worldwide was until recently known as Carnegie Asset Management, a money manager owned by Swedish private equity company Altor and employees, and founded in 1986.

C Worldwide hasn't previously disclosed the new mandate publicly, but Chief Executive Bo Knudsen told FW Asset Management about  the deal at an interview at the company's office in Copenhagen.

"We just signed a deal for DKK 6.8 billion with an Australian client on global stocks," Bo Knudsen told FWAM.

A visit in 2007

The asset manager's connection to Australia is nothing new. In fact, Australia is C Worldwide's second largest market today after the Danish.

"It began in this very room," said Knudsen, seated in a conference room, overlooking the Copenhagen waterfront.

"In 2007, we had a visit from a very large Australian fund. They thought we had an interesting track record and history. They were looking – and are always looking – for new, interesting managers."

Despite the interest from the Australian fund, Knudsen himself was not very interested at first.

"I said relatively early on during the meeting that I wanted to make two things clear. One was that they should not expect us to come to Australia, because we thought it was too far away. Secondly, we didn't find stocks on the Australian market very interesting, so we didn't want Australian stocks in our global fund," he says.

The 30 best stocks in the world

The Australian fund's interest was focused on the Danish asset manager's most famous product, its global equity portfolio, to which the new mandate for DKK 6.8 billion has gone.

The global equity portfolio has been a part of the asset manager's investment philosophy since the beginning in 1986: Finding the 30 best stocks in the world.

It is still like that. The global equity portfolio consists of 30 stocks.

"Our goal is to find the 30 best stocks in the world. We value growth, so we believe fundamentally that what drives stock market prices in the long run is revenue growth. It's a truism, but you tend to forget it when you sit in the eye of the hurricane and news is pouring in," says Knudsen, as he has been saying ever since he was hired in 1994.

But back in 2007 it was almost like refusing money, he says.

However, the initial rejection did not seem to scare away the big Australian fund that was interested in getting to know the Danish asset manager better.

"Three years went by, during which they analyzed us, and there was a lot of turbulence during that time," says Knudsen.

Carnegie Asset Management, as it was then known, was previously part of the Swedish investment bank Carnegie, but separated into an independent company when the private equity company Altor bought the Carnegie group out of the Swedish state, which had taken over the investment bank after it collapsed in 2008 during the global financial crisis.

"From 2007 to 2010, when they funded us, the investment bank went through a lot of turbulence in 2009. They gave us a small mandate, and today they are one of our biggest clients. It was also a beginning in reference to establishing ourselves in Australia," he says.

Australian partnership

The Danish asset manager has since expanded its Australian relations, and in 2012 it entered a collaboration agreement with BNP Paribas Investment Partners.

"They concentrate on finding the best managers, and they are our contact point with the client, making sure to bring us into play. So they take a lot of the daily work, considering the nine-hour time difference," says Knudsen, not willing to unveil the identity of the investor behind the new mandate.

He travels to Australia himself twice a year, and other colleagues of his visit the continent yearly.

C Worldwide has more than DKK 100 billion under management today. About 70 percent of that amount is in the global equity portfolio. Retail investors have since 1990 had the opportunity to invest via the investment fund C Worldwide Global Equities.

English Edit: Marie Honoré

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