Fallout from Westpac’s Hastings Funds Management sale spreads

Investors in one of Hastings Funds Management’s funds — the Utilities Trust of Australia — has dumped the group as its manager, instead voting for Morrison & Co to take control.

It follows a long-running saga with the infrastructure manager that was previously owned by Westpac Banking Corporation.

The decision will go to a unit holder vote in April before the arrangement is finalised.

Last year, Westpac sold the international operations of Hastings, which controls $14.6bn of assets, to British-based Northill Capital.

Subsequently, investors in its Australian UTA fund were unhappy and called an extraordinary general meeting to find a new party to take control of its investments.

Earlier, another Hastings-run fund — The Infrastructure Fund- called an EGM to remove Hastings as its manager following a string of earlier departures when Westpac owned the operation.

UTA has interests in assets including the New South Wales electricity transmission business TransGrid, the state’s property registry and Perth Airport.

The “TIF” fund holds stakes in assets such as Port of Newcastle, Queensland Airports, Perth Airport, North Queensland Airports and the Sydney Desalination Plant.

Advisory firm Grant Samuel has been advising UTA.

Morrison & Co ousted IFM in the competition to take control of the fund.

The Wellington-founded Morrison & Co, which now bases most of its investment and asset management operations in Sydney, will now control around $15 billion of assets, including Canberra Data Centres and Australian National University Student Accommodation.

The infrastructure manager originally owned a lot of the assets that were under Hastings control.

In a statement, UTA said it had received strong interest following a number of high quality managers.

The formal transaction will occur on July 1 following an EGM vote by UTA Unit Holders.

“Over the last few months, the Board has considered various investment management options for UTA,” the fund’s board said in a statement.

“In selecting Morrison & Co as its new manager, the Board is confident that the combination of a high quality portfolio and the stability afforded by an experienced, well regarded infrastructure manager will be an attractive proposition for both existing and new investors.”

UTA said the tender process had delivered materially improved terms for UTA stakeholders.

“The Board’s considered view is that the change of manager will provide UTA with a strong and stable platform from which to continue to deliver value for Unit Holders.”