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Chilean AM plans to enter third-party distribution business

Chilean AM plans to enter third-party distribution business

Chilean asset manager Quest Capital, the product of the recent merger of two local firms, is planning to launch a series of local mutual funds and enter the third-party fund distribution business.

Last Friday, asset manager CHG completed its merger with local advisory and wealth management firm Quest Capital to create a group with roughly $450 million in total assets. The combined company will operate as Quest Capital. 

‘Quest used to buy and invest in CHG funds, so they got to know us and to know that we did this well and that gave them confidence. That led to the merger,’ said Arturo Gana (pictured), who served as CHG’s chief investment officer and CEO and has now taken on the role of chief executive at the combined company.

Quest Capital is planning to become a third-party distributor of international mutual funds, though it hasn’t yet set a timeline to launch that business, added Gana.

It has, however, got a schedule for its fund business. By the end of the year, the firm plans to launch two more real estate funds, as well as potentially international equity and bond vehicles.

‘It would allow us to give a structure that allows our clients to access investments in international equities more easily than by investing in a fund or company abroad,’ he said. ‘Regulation has allowed it to be more [tax] efficient to invest in foreign assets through local teams.'

These new products will be in addition to its current offering, which includes two global fixed income funds, a Chilean bond vehicle and a local equities fund from CHG's fund roster. The new group's product range also includes a private equity fund.

Its funds are locally-domiciled in Chile but the company doesn't discard the potential for launching Ucits vehicles, said Gana.

The firm also hopes to leverage the relationships that Quest Capital had forged with pension funds and other institutional investors in Chile through its investment research services.

Including the company's 11 partners, Quest Capital has roughly 30 employees across its research, investment and support teams, Gana said. The firm has no immediate plans to make more hires.

Before the merger, the standalone Quest Capital used to bill itself as a boutique. The new company, however, is open to expanding and diversifying -- as long as it happens organically.

‘The idea is to grow, no doubt,’ Gana said. ‘But what we don’t want is to lose our focus on the client. We could launch 30 different funds, but we’re going to grow as we find opportunities to develop that area.’

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