8 December 2005 | by: GRAHAM Pam
Cameron Partners is a company that rarely makes the news but has an interesting story.
CAMERON PARTNERS is one company which has preserved a Wellington base and built an Auckland client list.
It sells advice to companies trying to work out where their industry is going and who they should be taking over.
Because the company works behind the scenes, it rarely appears in the business pages of newspapers. But its own story is an interesting one.
The firm started with two people, Ian Dixon and Rob Cameron, who left Fay Richwhite in 1995 to set up shop. They started as consultants, but their goal soon changed to being an independent investment bank. The model of a local firm just offering advice rather than a full suite of investment banking services had already been tried successfully overseas.
The view they and early recruits took of their own industry has paid off, as Cameron Partners ranked second on the latest New Zealand-wide mergers and acquisition tables compiled by Thomson Financial, behind First NZ Capital.
The deals that got them there this year included advising Rayonier New Zealand and RREEF Infrastructure on buying $435 million of Carter Holt Harvey's forests and the rolling in of $270 million of Rayonier forests into the package.
It also advised the independent directors of Carter Holt Harvey on the $3.3 billion takeover offer from Graeme Hart's Rank Group and the independent directors of Capital Properties on the takeover offer from AMP Property Portfolio. And it was adviser to New Zealand Post on the sale of its 50 per cent stake of its courier business to DHL, and Masthead on its takeover of plastics company Vertex.
The company is marking its 10th anniversary by changing its name from Cameron &s; Co to Cameron Partners. It now employs 21 people and has an office in both Auckland and Wellington.
Mr Cameron started at the Trade and Industry Department, worked in Parliament and at the Treasury when thought was being given to preparing government businesses for sale by turning them into state-owned enterprises.
He left Treasury in August 1984 to join Jarden &s; Co, a Wellington financial institution, and was part of a group of investment bankers who moved to set up an investment banking team at Fay Richwhite in Wellington in 1986.
Fay Richwhite supplied much of Cameron &s; Co's early talent base. Mr Dixon worked there. Murdo Beattie, who had worked there but moved on to be head of business development at Telecom, also joined in the early days.
Paul Dougherty was from the international mergers and acquisition team at Telecom. Recruits also included Steve Greenwood, who went back to Jarden days with Mr Cameron and Nigel Bingham.
Cameron &s; Co started as a consultancy but adopted the independent investment bank model as the team came on board. The business took off pretty quickly right from the start, Mr Cameron recalls.
"Within six months of starting we were probably the second-biggest team in Wellington behind First NZ," Mr Beattie said. "They subsequently wound back banking in Wellington. We've been the largest around here for quite a few years."
When they opened an Auckland office in 2000 they had thought about how it should work.
The idea was to try to run an organisation with two offices, rather than two businesses, or a common franchise.
Mr Cameron said the Wellington presence helped break into Auckland because an important part of understanding how an industry worked was understanding how government policy affected it. "Our Wellington presence is sometimes more important for our Auckland clients than Wellington clients."
In recent years it has found clients from Australian private equity firms looking to buy companies in New Zealand.
As the New Zealand goods, services and capital markets have moved closer together it was inevitable that advisory work would span both countries.
The firm, which is a company, rather than a partnership, as a legal entity, is doing a lot of work on the structure of state-owned enterprises.
If the Government is serious about its being a long-term owner of businesses, rather than preparing commercial arms for sale, the model will evolve. It is already doing so.
What the "best practise organisational architecture" for state-owned enterprises is the question Cameron Partners is researching.
The trend it is noticing in its own mergers and acquisition advisory industry is that clients are looking for advice separate from execution.
Global firms have come and gone from New Zealand and Cameron &s; Co has stayed. Local independents have also flourished in Australia.
"A lot of the globals have very high costs and if there is not a steady flow of large transactions they find it hard to justify being in New Zealand," Mr Beattie said.
When privatisations stopped some tried to service the New Zealand market from Sydney.
Mr Beattie said clients had become more sophisticated users of investment banking services.
Mr Dougherty said a trend of unbundling services, driven in part by regulations in foreign markets, had helped independent advisers.
In initial public offerings it was now common for advice, underwriting and distribution to be done by different people.
Cameron Partners does a lot of work on advising on capital management. That is broadly the capital structure of a company and the raising of debt or equity.
It is finding that banks with big distribution networks as well as advisory shops are willing to work with it. They provide the distribution.
"The independents are important originators of deals," Mr Cameron said.
He does not see that changing.
Changing technology and labour markets are altering the environment virtually every industry businesses operate in.
They are seeking advice on how to respond.
"It means that there is not an industry that is not going to see change and where there are not going to be opportunities for new combinations, for mergers, for acquisitions, for corporate restructurings," he said.
Cameron Partners had recognised that private equity firms were ideally set up to be agents of such change and had many private equity firms as clients.
CAPTION:
Brothers-in-arms: The Cameron Partners, from left Murdo Beattie, Rob Cameron, Steve Greenwood and Paul Dougherty. After 10 years the firm has changed its name from Cameron &s; Co to Cameron Partners.
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