Thick as thieves

It pays to have friends. Especially well paying friends.

Mates chip in $80m to rescue Turnbulls

A WHO'S who of Australian business has come to the rescue of the [Malcolm] Turnbull family's struggling listed investment company Pengana Managers, with an $80 million recapitalisation plan. [After playing footsy with Labor, Turnbull is the new-ish darling of the Liberal Party, and will be having a thing or two to say about tax and other business policies, especially once Costello spits the dummy. He was the strong arm behind the ARM group who put a wrecking ball through the Republican movement momentum.]

Investment bankers Chris Mackay and Hamish Douglass have assembled a number of high-profile investors, including James Packer, Sussan's Group owner and executive chairwoman Naomi Milgrom and Citadel Investments' former managing director in Asia, Simon Leversha, to back their new funds management venture.

The investors will inject $80 million into Pengana, which will be renamed Magellan Financial Group and become the exclusive funds management investment vehicle for Mr Mackay and Mr Douglass, who recently ditched their high-paying jobs at UBS and Deutsche Bank to start a business together.

Malcolm Turnbull set up Pengana Capital with his former Goldman Sachs colleague, Russell Pillemar, in 2003. A year later the group listed hedge fund vehicle Pengana Managers on the stock exchange, only just managing to get the $30 million it needed to list despite attracting the likes of the Smorgon and Myer families, former Hoyts boss Peter Ivany and Allco boss David Coe to its register. Since then, the listed fund has struggled to trade above net assets.

The Turnbulls own 20 per cent of the company and will remain on the register, although the investment is run by Malcolm's wife Lucy, the former mayor of Sydney, now that Malcolm is the Liberal MP for Wentworth.