A $10.7B Shop Hunts for Subadvisory Biz After a Win
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Thursday, July 13, 2017

A $10.7B Shop Hunts for Subadvisory Biz After a Win

A Chicago-based asset manager with $10.7 billion in AUM just landed a subadvisory mandate and is hunting for more.

Litman Gregory Fund Advisors, a California-based company, has hired Segall Bryant & Hamill as a subadvisor to the Litman Gregory Masters Smaller Companies Fund. Segall Bryant & Hamill is also subadvising for Columbia Threadneedle and Beacon Pointe Advisors, and Mark Rewey, principal at Segall Bryant & Hamill, tells MFWire that "subadvising is a business area the company is looking to grow in."

First Pacific Advisors (FPA) had been a subadvisor for the Master Smaller Companies fund since the fund's beginning in 2003. An executive from FPA has declined to comment on the change.

Segall Bryant & Hamill has replaced FPA and now handles one-third of the fund's assets. Mark Dickherber, and Shaun Nicholson, both PMs at Segall Bryant & Hamill, are now co-PMs on the Smaller Companies fund. Rewey tells MFWire that Segall Bryant & Hamill has been on Litman Gregory's recommended list for the past year. The fund's other two PMs are Jeffrey Bronchick of Cove Street Capital and Dick Weiss of Wells Capital Management.

"We have been impressed with the co-managers of the small-cap value team at Segall Bryant & Hamill for several years," states Jack Chee, Litman Gregory principal and co-PM. "We think their edge lies in their focus on identifying the potential for significant improvement in a company's return on invested capital, and more specifically, positive change with respect to company management's capital allocation decisions, which is often a precursor to sustainably higher levels of profitability."

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