Just saw this substantial shareholder notice and after noting:a)...

Just saw this substantial shareholder notice and after noting:
a) Regal's recent capital raise via 1 for 5 rights issue, and
b) Regal's Chair is Michael Cole (who used to be the Platinum Chair if memory serves correctly)...
...I wondered whether it could ever make sense for Regal to propose a merger with PTM.

Regal needs/wants to grow FUM and has to figure out a solution for the problem plagued VGI global equity funds which are bleeding FUM and have had terrible performance for quite some time as well as suffering significant staff turnover. Meanwhile, PTM is struggling with its marketing and distribution efforts and could use some of the Regal chutzpah and access to their private client networks (and could perhaps also learn some better short selling/trading skills from Regal).

The problem for high fee managers like Regal and PTM (or MFG for that matter) in conducting M&A is finding merger opportunities where they can extract scale synergies without having to reduce their average fee via cannibalisation. Regal and VGI had similarly high fees, so they could pull off their merger, but VGI has basically imploded and needs some serious rehabilitation. Platinum could help with that, and the combined group could perhaps get re-rated by the market.

There is reasonable synergy in that Regal are mainly focussed on domestic equities and alternative strategies, whereas Platinum are mainly variable beta long short global equities like VGI. VGI have little to no credibility in Asian equities, whereas Platinum do. Sure, PTM don't charge a performance fee like VGI do, but VGI's fee structure is unsustainable and is also probably way under the high watermark so not a money maker anyway (the more immediate threat is stemming the outflows of FUM). The lack of a PTM performance fee would probably make it easy to get VGI funds' unitholder approvals for the change in underlying manager.
The only losers in this scenario are probably Rob Luciano and any remaining VGI staff. Perhaps Andrew Clifford wouldn't like it, but Kerr may go for it. Interested in people's thoughts on this.