Mergers and acquisitions involving asset managers rose in the third quarter, with the global credit crunch as the backdrop for a surge in divestitures to almost 40 per cent of total sales,
Mergers and acquisitions involving asset managers rose in the third quarter, with the global credit crunch as the backdrop for a surge in divestitures to almost 40 per cent of total sales, up from 23 per cent a year earlier, according to New York-based investment banking business Jefferies Putnam Lovell.
Sixty-nine asset manager transactions worldwide were announced in the third quarter, an increase of 33 per cent from 52 in the same period of 2007, according to preliminary data from Jefferies Putnam Lovell, which focuses on the asset management and financial technology industries.
Total assets under management changing hands amounted to USD1.0 trillion, more than three times the USD300 billion total in the third quarter of 2007. Total disclosed deal value in the third quarter of 2008 increased to USD6.4 billion from USD6.1 billion a year earlier.
‘As we anticipated, tremors transforming the global financial landscape have served as a catalyst to asset management deal flow,’ says Aaron Dorr, a managing director at the firm.
‘In the short-term, we expect more banks and other cash-strapped financial institutions to retreat from owning money managers, private equity firms to step up their growing involvement in the sector, and consolidation among hedge fund companies and other alternative asset managers as firms grapple with investor redemptions and lack of liquidity. Consistent with the broader financial services industry, the asset management sector is quickly reshaping.’
According to Jefferies Putnam Lovell, standout third-quarter transaction include the announced sale of Lehman Brothers fund units, including Neuberger Berman, to Bain Capital and Hellman & Friedman, Allianz’s takeover of Cominvest as part of a deal that saw its Dresdner Bank unit acquired by Commerzbank, Fortis’s buy-out of minority shareholders in Artemis Asset Management, and Lazard’s acquisition of the stakes in Lazard Asset Management held by the business’s executives.
Jefferies Putnam Lovell, which was established in 1987 and acquired by Jefferies & Company in July last year, has offices in New York, San Francisco and London. It offers a range of corporate advisory services including mergers and acquisitions advice and capital-raising to clients including diversified financial services firms, institutional and mutual fund managers, alternative investment managers, banks, broker-dealers, insurers, and financial technology firms.
