Two of Western Australia’s most successful stockbrokers – Brad Shallard and Romano Sala Tenna – have taken their partnership a step further, launching their own listed investment company.
Two of Western Australia’s most successful stockbrokers – Brad Shallard and Romano Sala Tenna – have taken their partnership a step further, launching their own listed investment company.
The pair, based at Bell Potter Securities, is seeking more than $20 million for the company, Katana Capital Ltd, which they plan to run as an all-opportunities fund, taking advantage of the institutional clout of such a vehicle.
Mr Sala Tenna and Mr Shallard have been recognised for their broking success, including key roles in the likes of the float of education provider IBT Ltd.
Mr Shallard said the pair opted for a smaller, less time-consuming launch of their investment company so as to participate in opportunities that arose early in the New Year.
“We wanted the flexibility to take advantage of that,” Mr Shallard said.
“We decided to go for pre-Christmas.”
However, the structure of their own IPO leaves open the opportunity for oversubscriptions to take the funds raised up to $50 million, the target they would have set had they opted for a later launch. Mr Shallard claimed Katana was on track to reach its $18 million minimum.
Each of the $1 shares comes with a free option, with a 95 cent strike price.
He said the plan was borne of difficulties in satisfying retail client demand for floats, with institutional buying power constantly soaking up supply.
“At the moment we are finding the institutions do quite well out of us and the retail clients are quite frustrated,” Mr Shallard told WA Business News.
“We have decided to set up our own institution and allow them [retail clients] to participate.”
Mr Shallard said the investment company had Bell Potter’s blessing but would be independent of the brokerage, with each decision based on an investment committee comprising himself and Mr Sala Tenna as investment managers, with a third research analyst.
The firm is chaired by Perth lawyer Dalton Gooding and will have three other non-executive directors – Bell Potter head of corporate (WA) Peter Wallace, lawyer Derek La Ferla and Giuliano Sala Tenna, senior manager (distribution) for HFA Asset Management.
To obtain regulatory approval for the prospectus the stockbroking pair used the track record of Katana, a jointly run private company before it became a public company, along with the trading performance of their own individual private investment companies, Classic Capital Pty Ltd and BS Capital Pty Ltd.
Mr Shallard and Mr Sala Tenna are both directors of Classic Capital, which has been appointed as the manager of Katana.
“Where we are a bit different,” Mr Shallard said, “is if after five years we have not performed the shareholders can vote us out and either wind up the fund or appoint a new manager.”
