Industry buzzing about Krembil/Bousada firm

By Mark Noble | February 20, 2008 | Last updated on February 20, 2008
3 min read

Few details — but a lot of speculation — are emerging about what Tye Bousada’s new firm, EdgePoint Capital Partners, is going to mean for the industry, especially since he’s received the financial backing of Trimark co-founder Robert (Bob) Krembil.

Bousada, until recently a high-profile lead manager of AIM Trimark’s flagship Trimark Fund, announced Tuesday he has created his own firm, EdgePoint Capital Partners, owned by Cymbria Capital Corporation, of which Bousada is the president and founder.

Because EdgePoint is still seeking regulatory approval from the Ontario Securities Commission, Bousada would not go into detail about what the new firm will do. He did tell that Krembil, through his holding company, Chiefswood Holdings Ltd., has taken a significant stake in Cymbria — between 25% and 51% of the shares. He also hinted that it will be a fund management business.

“I can say we think the industry needs another fund management business; otherwise, there would be no point in launching EdgePoint,” Bousada says. “We believe the industry is ready for change.”

The partnership of the two Trimark stalwarts has some wondering whether this is the beginning of a throwback firm that resembles Trimark Investments before it was purchased in 2000 by Amvescap PLC (now called Invesco) and transformed into AIM Trimark.

It was Krembil who originally hired Bousada at AIM Trimark. In 2000, Bousada was named the co-manager on the Trimark Fund, working with star manager and Krembil protégé Bill Kanko. When Kanko left the firm in 2004, Bousada took on lead management duties for the fund.

There is no indication from Bousada that AIM Trimark has lost its way. He stresses quite the opposite.

“I have nothing but great things to say about AIM Trimark. They provided me with a career filled with opportunity and challenge, and there are lots of great people at the company,” he says. “I just have an entrepreneurial idea that I want to pursue.”

Industry analyst Dan Hallett, president of Dan Hallett and Associates, notes that Krembil’s and Bousada’s names alone are going to be a big draw for advisors if they launch retail funds, which he believes they will.

“They have something of a brand you can associate with them as individuals,” Hallett says. “The average age of financial advisors is around late 40’s or early 50’s. The typical advisor has fond memories of a Krembil-run investment firm. I think his name alone certainly carries some weight. Advisors would certainly be enthused about him coming back into the industry. Then you have Bousada, who those advisors have also come to know as well, along with a younger generation of advisors. I think that just in terms of the name recognition, they bring a lot of value to the table.”

In the meantime, Hallett has had to put Bousada’s former Trimark Fund, which he recommends, on review, along with the rest of the AIM Trimark funds he liked. In addition to Bousada, AIM Trimark has lost top-name talent in recent months, including its chief investment officer Patrick Farmer and well-known portfolio manager Geoff MacDonald. Hallett remains optimistic about AIM Trimark’s future.

“I’ve actually put all of the AIM Trimark funds under review that are on my recommended lists because of larger organizational concerns, and I just want to be sure no one else is going to leave while they have a chance to turn certain things around — which they have started doing. But these things take time,” he says.

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Mark Noble