Money Talks: This high net worth investor reveals why Asian money is more interested in the ASX
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Money Talks is Stockhead’s regular drill down into what stocks investors are looking at right now. We’ll tap our extensive list of experts to see what’s hot, their top picks and what they’re looking out for.
Today, we hear from Marcus Liew, managing director of Asia Cornerstone Asset Management.
Seafood and the ASX are probably the last two things that one would expect to encounter together.
Yet, that is precisely the combination that Asian investors are keen to put their money into, according to Liew.
ACAM, a Hong Kong-based fund, has already assisted a number of companies with their ASX listings with the latest, Singapore-based 3D printed bioresorbable implant manufacturer Osteopore set to hit the market on September 23.
And there could well be more such investments further down the horizon with Ventnor Capital, the fund’s eyes and ears in Australia, having already presented several business proposals for consideration.
Liew said that Asian investors considered the ASX to be a high-quality, well-governed exchange with much better liquidity for small-cap companies than competing primary exchanges globally.
“There is a good degree of transparency in how businesses are managed in Australia, there’s a good degree of integrity in how businesses are conducted here, and the Australian brand name has good standing with Asian investors.”
So what are some of the things that ACAM looks for before making a decision to invest and support a company?
First off the rank is the calibre of its founder(s) and management team.
“We look at the character of the founders or the operating people of each specific business. We will do a background check on them to see who they are and who they really are,” Liew said.
Osteopore is a strident example of this focus with Liew noting that when the company was in its early days, its founder committed to mortgaging his own house to help the business succeed.
“He (Osteopore’s founder) struck me as an entrepreneur who really wanted to sacrifice in order to keep his passion going,” Liew said.
The Singapore medtech also benefited from several strategic stakeholders, such as the National University of Singapore, several FDA approvals and perhaps just as critically, an existing revenue stream that further distinguished it from other medtech companies that usually attempt to list without breaking even or having established any revenues.
“Hence this IPO, the proceeds will be used for the business development, sales side of the company, after that it will just grow dramatically,” Liew said.
Besides the medtech and biotech sectors, ACAM is also keen on aquaculture, agriculture and logistics.
“Any fresh produce that comes out of Australia is perceived to be premium, of very good quality, in Asia and there is huge demand,” Liew said.
“We are that bridge between Australian famers to the consumers in Asia.”
Reflecting this interest, ACAM recently acquired a prominent Western Australia seafood processing business that had been in the market for 40 years.
“They have always been restricted to WA territories. What we are doing is, we are looking at overseas expansion for them so that they will be able to grow out of WA right into Asia, Singapore, Malaysia and China. We are structuring an IPO plan for them,” he said.
Liew added there were a number of high-quality Australian projects that had not been able to access capital in the local market.
“We are able to bring in capital from overseas to finance and support these people. We actually participate in the management team at a higher level such as how to package the branding, the intellectual property, to unlock the value of the company for IPO purposes.
Marcus Liew is the founder of Asia Cornerstone Asset Management and a majority shareholder in Janz Asset Management. He is passionate and experienced in the private equity investments arena, and has extensive interests in the medical, agricultural, medical, bio-medical and as well as tech industries.