Deal will combine $13.4 billion in sustainable investing assets under management
Impax Asset Management Group agreed to acquire Pax World Management for up to $90 million, said Joe Keefe, Pax's president and CEO.
Under the terms of the deal, Impax will acquire 100% of Pax at an initial valuation of $52.5 million. Impax will later pay an additional $37.5 million by 2021, subject to Pax's future performance.
Pax World Management has about $4.5 billion in assets under management. Impax is a U.K.-based investment manager with approximately $9.4 billion in AUM.
Both firms specialize in sustainable investing and share similar corporate cultures and values.
Pax will be renamed Impax Investment Management (U.S.) LLC. Both management and investment teams will remain in place after the deal closes. The Pax World Funds suite of mutual funds will retain their name as the U.S.-based mutual fund division of Impax's global business.
Mr. Keefe will continue to lead the renamed company, reporting to Impax CEO Ian Simm. Mr. Keefe will also be named to Impax Asset Management's board.
"We've worked together for a long time," said Mr. Keefe in a phone interview. "We've been partners for years, so we knew their team well, we knew their process well. They've subadvised our funds. Our investment processes are very similar."
In 2007, Impax and Pax partnered to design and manage the Pax Global Environmental Markets Fund, which was launched in 2008 and currently has more than $500 million in assets.
Mr. Keefe added: "With scale comes opportunities. We'll be able to provide our clients with lower fees, deeper investment capabilities, better client services, broader distribution and access to global markets."
The transaction, which is subject to the approval of the investment advisory agreement by the trustees and shareholders of Pax World Funds, is expected to close by the end of the year.