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Magda Wierzycka, outgoing joint CEO of Sygnia Group. (Image: Getty Images)
- Magda Wierzycka, founder of investment management company Sygnia, will step down as co-CEO in May.
- You are turning your attention to other priorities, including your own investment vehicle.
- Wierzycka is a great investor in a fund linked to the University of Oxford.
- The high-profile Wierzycka is intrinsically linked to the Sygnia brand and is controversial at times.
- The company may want to create a different image for itself – bBut she is still the largest shareholder and is still expected to make the decisions.
- For more stories, go to www.BusinessInsider.co.za.
Magda Wierzycka, founder of investment company Sygnia, has resigned as joint CEO as she shifts her focus to seeking opportunities abroad and concentrates on her own investment vehicle.
David Hufton, who was appointed deputy CEO in 2018, then joined Wierzycka at the helm of Sygnia last year, will take over as sole CEO from June.
Speaking to Business Insider South Africa after the announcement, Wierzycka said that leaving office was a decision that took a long time. The move was not particularly important from Sygnia’s perspective, he said, given that it will remain a majority shareholder in the business and will continue to serve on its board of directors.
“I will contribute as much as possible to the business strategy, to innovation, to the search for opportunities for Sygnia; not only here in South Africa but also abroad. But the fact that I am no longer tied to day-to-day operations gives me the freedom and flexibility to do all of that, ”he said.
Part of his plan involves seeking investment opportunities for Sygnia, particularly in the United States, where he hopes to spend three months this year studying its economics.
It is also turning more attention to its investment vehicle Braavos Investment Advisors, which has already attracted £ 5bn (over R100bn) in assets under management, it said.
Wierzycka owns Braavos with Sygnia director André Crawford-Brunt. The company has a large stake in Oxford Sciences Innovation (OSI).
OSI has an exclusive agreement with the University of Oxford to commercialize its research, which may include the Covid vaccine that the university designed in partnership with AstraZeneca. Other OSI shareholders, including Tencent, Huawei, and Google Ventures. But Braavos has the largest share (20%), according to the UK publication. The Telegraph.
OSI made headlines last year after the unexpected resignation of its chairman, Patrick Pichette, Google’s former chief financial officer, shortly after the departure of its chief executive Charles Conn.
The Telegraph blamed the Exits about “internal disputes over strategy in the fund, linked to the emergence of a new, larger shareholder, South African investment vehicle Braavos Capital.” There appears to be disagreements about rising costs and staff turnover at OSI, according to the post.
A possible factor in Wierzycka’s decision to step down as Sygnia’s CEO may be the growing danger of a conflict of interest between her role at Sygnia and her activities at Braavos and OSI.
Last year, Sygnia announced that it will invest in two Braavos venture capital funds and that it will appoint Braavos, Wierzycka and Crawford-Brunt as “investment advisers and directors” as part of the agreement. Under the agreement, they will be paid around R25 million a year for these services, of which around R14 million will be reimbursed as part of an agreement to lease office space and obtain legal and compliance support from Sygnia in the UK. .
According to a CityWire report, Sygnia has invested R2 billion in Braavos. Some of Sygnia’s funds, including Sygnia 4th Industrial Revolution Global Equity Fund and Sygnia Health Innovation Fund, are also invested in OSI.
Sygnia’s investments in Braavos and OSI, which are closely tied to Wierzycka in its private capacity, have started to raise questions about conflicts of interest. At the company’s recent annual general meeting, Crawford-Brunt resigned as a director, apparently due to these concerns among shareholders, CityWire reported.
Sygnia without Wierzycka as CEO
Wierzycka co-founded Sygnia 15 years ago and increased its assets under management to R251 billion during his tenure.
From the beginning, it was intrinsically linked to the Sygnia brand. This has helped Sygnia, especially as Wierzycka won praise for her strong stance against state capture.
But it has also been a double-edged sword, with Wierzycka, for example, receiving criticism for insensitive posts on social media.
And while Wierzycka’s continued attacks on the high commissions that active investment managers earn have earned him a following among retail investors, it has earned the ire of many in the investment industry.
For Sygnia to grow in the future, the company will have to win more business from institutional investment, including from large pension funds, a commenter told Business Insider. The retail market, which is aimed at individual investors, is not large enough in South Africa.
Given that she is a sometimes controversial figure, the company may be trying to create the impression that “this is no longer the Magda show,” says Casparus Treurnicht, portfolio manager at Argon Asset Management.
“She started the business and I think there are a lot of emotional elements involved, and I think maybe the board of directors, including her, decided it’s time to give the business a new look,” she said.
“They’re moving away from what appears to be a Magda-run business and now making it look like it runs independently. But at the end of the day, I think Magda is still going to call out some big shots,” Treurnicht said.
“I think we will see more of what Magda wanted this business to become and I think that is exactly what they are doing.
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