Australia-based funds management company Pengana Capital Group has reached a deal to sell its 65% direct equity stake in Lizard Investors for an undisclosed sum.

With headquarters in Chicago, Lizard is an asset management firm that offers small to mid-cap equities across the globe.

The new deal will be carried out under a management buyout initiative led by Lizard chief investment officer and portfolio manager Jon Moog.

In a statement, Pengana said: “Whilst Pengana will continue to enjoy a close relationship going forward with Lizard, following a strategic review it was concluded that Lizard would thrive and be able to attract and retain talent if wholly owned by the management team.”

Pengana added: “The divestment will not, in any way, impact arrangements between Pengana and Lizard regarding the management of the Pengana Global Small Companies Fund, which have been in place for nearly eight years, predating Pengana’s investment in Lizard by nearly five years.”

The firm expects to realise earnings accretive from the selling of the Lizard stake in the second half of this year.  

The sale will reduce Pengana’s reported total funds under management (FUM) by around A$258m ($179m), noted the company.

In November 2019, Pengana announced its intention to buy a stake in Lizard, without revealing the figure.

In 2015, both the firm launched a joint venture to sub-advise the Pengana Global Small Companies Fund.