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Macquarie Bank chief executive Allan Moss; Macquarie Bank and Shinhan Financial Group plan to sell about US$500 million of shres in a fund investing in South Korean toll roads, such as this one in Seoul.

Macquarie Bank has confirmed that it will raise A$1 billion ($5.9 billion) and enter the media industry - and the surprise is the bank is likely to look at Asian assets as it compiles its shopping list.

Details of the float of the new Macquarie Media Group (MMG) were revealed last week, with the unexpected announcement that the fund would be international in focus, not just Australian.

'If it's a good buy, we'll look at it,' executive chairman Tim Hughes said in launching the float, adding that he would be casting his net far and wide for assets.

While MMG would scour the developed markets of Australia,  Britain, Europe and the United States,  Mr Hughes  said  the company would keep an eye on broadcasters, outdoor advertising companies, newspapers and internet companies in Asia.

MMG's international focus is a good example of how Macquarie has outgrown its Australian home and has emerged as a global player, particularly in the infrastructure sector.

And while the global attention is on the bank's potential bid for the London Stock Exchange, Macquarie is also looking to Asia as a key driver of future growth.

Just 12 months after integrating ING's former cash equities business in Asia, Macquarie is using that  unit not only to scale up its broking presence but also to gain momentum for its other business areas which have proved successful elsewhere, such as corporate finance, property and its specialist fund model.

The bank has built its reputation through the innovative packaging of assets - from airports to toll roads to golf developments - into listed and unlisted funds. And while the parent company enjoys a market capitalisation of  about A$14 billion, it also controls assets worth A$46 billion around the world.

Only 4 per cent of those, however, are in Asia - largely in Korean toll roads - but that is a situation  that is likely to be rapidly redressed.

'There has been a shortage of assets available in Asia but that is changing as governments increasingly move to privatise,' Macquarie chief executive Allan Moss told the South China Morning Post recently.

'The other reason is that, until recently, there hasn't been an appropriate regulatory environment for securitising assets and now regulations are being introduced to facilitate that, so those impediments are being addressed rapidly.

'The opportunities for securitised real estate and infrastructure in Asia are absolutely huge.'

Macquarie's growing Asian ambitions are detailed in a recent presentation to investors and analysts where a  group of senior executives from different divisions of the bank outlined their current regional operations and also their potential for growth.

While the bank's head count in Asia has gone from 120 in 2000 to more than 850 today, largely due to the acquisition of the 450-strong ING business, the hiring spree is continuing as Macquarie builds more scale in the region.

First, Roy Laidlaw,  managing director of Macquarie Securities Investment Banking Group, spoke of the 'extraordinary' improvement in brand perception of the old ING cash equities business since the acquisition.

Describing the acquisition as both 'cheap' and 'opportunistic', Mr Laidlaw  outlined  achievements in the past 12 months, such as the acquisition of a Malaysian broking licence, the opening of an office in India and the commencement of new higher-margin businesses  including options trading, convertible bonds and hedge fund sales.

'We hope that Asia will generate similar returns to Australia in the next couple of years,' Mr Laidlaw said.

'Twelve months into a multi-year project, progress is better than expected.'

While the former ING business is well known in Asia - and Macquarie claims it is now the leading foreign broking house in both Hong Kong and Malaysia - less well known are the bank's ambitions in corporate finance, property and specialist funds.

'The increase in corporate finance deal flow and revenue since the ING acquisition is well ahead of expectations, albeit off a low base and still early days,' said Andrew Low, head of Asia for Macquarie's corporate finance investment banking group.

Mr Low's presentation detailed just under 50 deals - from mergers and acquisitions to project finance - Macquarie had been involved in over the past  year in the region.

He forecast that revenue from his regional corporate finance operation would grow  250 per cent from  last year to next year.

Crucial to that growth would be Macquarie's 'differentiated business model' whereby the bank would aim to be 'more local than Wall Street and the Europeans', said Mr Low.

A third Macquarie unit expecting strong growth in Asia is the bank's property division, where division head Stephen Girdis outlined a plan to build momentum following the acquisition of a strategic stake in Singapore's recently listed S$1 billion ($4.6 billion) Prime Reit.

Another major transaction has been the acquisition of nine retail malls in China with a syndicate of institutional investors.

Leveraging on joint ventures such as Macquarie Goodman - which has interests of  about  $2 billion in Hong Kong - Schroders Fund and the First China Property group, Mr Girdis said Macquarie was well positioned in Asia through a strong presence in real estate investment trusts (reit).

'The objective is to grow the property business in multiple niches in selected capital and real estate markets with particular opportunities in reits and fund management,' said Mr Girdis.

'Macquarie is succeeding with major inroads in Asian real estate.'



Macquarie Bank media float to finance Asian shopping spree