The promoters of Liontamer’s recent capital-protected investment offering are coy about the amount they raised during a recent investment roadshow, saying it was more than $5 million but less than the potential target of $20 million. Liontamer’s second capital-protected offering, being marketing this month, will target $5-15 million.
The partners in Liontamer who brought the product to the New Zealand market include managing director and Belgium-born Laetitia Peterson (35). She has worked at investment banks in the US and UK and more recently as director capital markets at Bank of New Zealand. The other Partners are Michael Lodge (33), an ex Bankers Trust business development manager; Neville Giles (33), formerly business development manager at Hanover Group; and Janine Starks (33), who recently returned from six years in the UK where she worked for a firm of financial advisers, Chase de Vere. Investors buy into a “tax-efficient” Australian-based unit trust.
In the recent Easy Grow 85 offering an investor’s capital is protected at maturity (an eight year term) and in addition investors may receive a percentage of the growth in the MSCI world shares index. If the participation rate is 80%, the investor receives 80% of the rise in the sharemarket – assuming it rises. The latest product is called Super Grow and offers 150% of world sharemarket growth over the eight-year term.
There is little research available in New Zealand about structured retail products as they are known in the UK and US where they have been more common over the past decade. Website www.StructuredRetailProducts.com detail such offerings, some of which have been successful but there have also been a few spectacular failures.
Ms Starks described the investments as buying a type of insurance. Liontamer promotes the offerings as a solution for people who want to reduce the risk of owning shares directly. Many investors will be tempted to take out such protection after recent experiences on world markets, although the time for promoting them might have been better during the past couple of years as markets appear to be recovering, which affects the structure of subsequent investment offerings (promising less upside). Liontamer managers use the money to buy equity linked notes (options) issued by US financial services group and derivatives trader Morgan Stanley. The value of the notes reflects the international share values, as measured by the MSCI world share index.
