Seamark Asset Management Ltd., the Halifax-based money manager and former star of the Atlantic investment industry, says it’s on the rebound, despite being badly battered by storms that have sent assets under management sinking to $2 billion, down from an $11 billion peak in 2004. The company’s stock, which soared as high as $24.55 a share, now hovers around $1.

It’s a challenging time for newly appointed CEO Brent Barrie to seize the helm. But Barrie, who has been with the company in a variety of roles for the past eight years, views his promotion as “a great opportunity” and says he can steer the ship back on course and persuade new clients to come on board.

“We are good at controlling risk and protecting capital in down markets, and have enabled our institutional clients to meet their obligations over the long term,” says Barrie, 41. “Historically, we have been well received by small to medium-sized institutional clients, and those are the kind of relationships we are seeking. We are committed to rebuilding from the bottom up, as we did when we first entered this business.”

Barrie replaces former CEO Stuart Raftus, who left last March after three years. The high-priced Raftus, who was lured away from Bay Street, was a costly hire for Seamark, and the terms of his departure shaved $5 million off the firm’s bottom line. Prior to Raftus, the revolving door was already spinning on the CEO’s office. Robert McKim, a 20-year Seamark veteran who took over as CEO when company founder Peter Marshall resigned in 2003, lasted less than two years before butting heads with the board and leaving. Marshall came out of semi-retirement to run the company on an interim basis in 2005, but left again about a year later, when Raftus was recruited in 2006.

In the midst of the management turbulence, Seamark was hit with a massive blow when it lost IA Clarington Investments Inc. as a client in 2006, and $3 billion in AUM went out the door with it. Around the same time, Seamark was struggling through a period of investment underperformance, when resources and small-cap stocks were driving the equities markets and Seamark’s exposure to these companies was relatively light.

More recently, Seamark’s AUM have been pared by the market downturn, as well as the loss of two significant wrap partners that accounted for about $400 million in AUM. Although Seamark did not disclose the identity of the partners, a report by Michael Mills, an analyst with Halifax-based Beacon Securities Ltd., speculates they were BMO Nesbitt Burns Inc. and RBC Asset Management Inc.

Barrie represents a return to Seamark’s roots. He has a down-to earth, unassuming style and steadfast determination that contrasts with Raftus’ flashier, outgoing personality, analysts say. Unlike Raftus, Barrie has worked his way through the ranks and has had an inside view of Seamark’s rise and fall over the years.

“What Seamark needs, it will have with Brent,” says John Aiken, an analyst with Dundee Securities Corp. in Toronto. “He’s someone who is respected by colleagues and can steer the company. Seamark doesn’t need a rock star; it needs someone to focus on the nuts and bolts. And I view Brent’s appointment quite positively.”

Seamark manages money for institutions such as pension funds, endowment funds, charitable foundations and wrap accounts, as well as for private clients. In September, 2007, Seamark launched a line of three mutual funds: a North American equity fund, a Canadian equity fund, and a dividend and income fund.

The investment style established by company founder Peter Marshall is patient and conservative. It’s a low-turnover approach of identifying quality companies and holding for the long term. The Seamark team seeks companies with strong balance sheets, management strength and advantages that will allow them to grow faster than competitors.

“At heart, we are a research shop,” Barrie says. “We try to purchase well, buying companies that are out of favour due to short-term concerns but where we are positive about the long-term value of the franchise.”

Barrie has a persuasive Seamark story to tell as he hits the road to reassure existing clients and lure new ones. During the past 24 years of managing balanced accounts, Seamark has been above the median relative to its peers in 19 of those years, he says. As of March 31, Seamark’s pooled fund performance for all categories — including bonds, Canadian equities, international equities and balanced portfolios — was ranked in the first or second quartile for one, three, five and 10-year periods. The results for the pooled funds, Barrie says, are a “fair reflection” of all Seamark portfolios.

@page_break@Barrie also notes that it’s an opportune time for winning new accounts. All institutional clients with equities in their portfolios were hit by losses last year, and as a result, some are underfunded in terms of being able to meet obligations such as pension payments. Others, such as charitable and endowment funds, are faced with cutting back on their activities until markets rebound. Barrie says a lot of institutional accounts are evaluating whether they are comfortable with their current stable of managers, creating an opportunity for Seamark: “Many institutional accounts have a lot of hard work to do to get back onside, and we believe that with our superior long term track record, we can help them over time.”

While performance is important, Barrie is also working hard to reassure clients about the stability of Seamark. He expects the company to return to profitability in fiscal 2010, and says it has no debt and $10 million in liquid assets. Seamark suspended its dividend in 2008, but, Barrie says, it will be reinstated as soon as AUM begin to grow in a sustainable manner. Costs have been cut, and Raftus’ departure alone reduces annual expenses by $1.5 million.

Barrie views the Seamark mutual fund family as another opportunity to gather AUM, although the firm will wait until retail investors regain confidence before doing any serious promotion. The funds, being recently established, have only a one-year track record, so there is still no long-term performance by which to be judged. “When industry sales turn positive, we expect we will collect our share of mutual fund assets,” Barrie says. “We have not yet put a significant push on the funds; but as we see an appetite growing, we will become more active in seeking attention.”

Although Barrie began his career as a lawyer, he also has experience on the investment side. In his eight years at Seamark, he was a member of the equities research team, handled investor relations and compliance, and held positions such as corporate secretary. His previous role before becoming CEO was chief operating officer. He currently serves as chief compliance officer as well as CEO.

A graduate of Dalhousie University, Barrie articled in Ottawa, then returned to his native Nova Scotia to practise law “for as short a time as possible.” He worked for six years at CIBC Trust, at which he was initially involved with wills and estate planning for high net-worth clients, but later handled investment portfolios. He joined Seamark in 2001 as a member of the investment team, and also handled compliance issues when Seamark became a public company later that same year. As his interest in the investment world grew, he obtained his Canadian investment manager, certified financial planner and chartered financial analyst designations.

“Brent has worked his way up through the company,” says Aiken, “and understands both the investment side and the corporate side of the business.”

Despite Barrie’s experience, analysts say, it will be a battle for the seasick company to rebuild AUM and regain sales momentum; they also suggest that the brand has been damaged by turnover at the top. “Even with Seamark’s decent track investment record, there are a lot of firms that have performance that is just as good, without the organizational issues,” says analyst Dan Hallett, president of Windsor-based Hallett & Associates Inc. “Seamark will need to demonstrate it has the right leadership in place, all the while maintaining a skilled investment team and keeping performance on track. It’s going to be tough.”

There has been some speculation about a management buyout or a takeover by insurance giant Manulife Financial Corp. of Toronto, which controls 31% of Seamark and is the largest shareholder: Marshall still owns 13% of Seamark, although he is no longer active on the board.

“We are a public company, and the board will continue to review how best to deliver value to shareholders,” Barrie says. “We are capable of delivering results through the public company format or through other structures.” IE