NEW YORK — Alternative investments proved to be a bright spot in a mostly bleak money manager M&A period in 2004, with Mellon Financial Corp. leading the way with five deals.
According to Asset Management Focus, a report published by Freeman & Co. LLC, New York, there was a 13% decline in acquisition activity last year, to 147 deals announced, from 169 in 2003. The report stated alternative investments were the only sector that saw a significant increase in deals. "Alternatives continued to be hot, with the number of alternative acquisitions increasing by nearly 40% for the second straight year," the report stated.
Mellon Financial was the most active acquirer, announcing five acquisitions totaling $44 billion in assets under management, the report stated.
Mellon was followed by Affiliated Managers Group, Prides Crossing, Mass.; UBS AG, Zurich; Bear Stearns & Co., New York; and BNP Paribas SA, Paris. Each had four acquisitions last year.
In June, Mellon bought Evaluation Associates Capital Markets, a Norwalk, Conn., manager of hedge funds of funds for high-net-worth investors, pension funds and endowments. Evaluation Associates manages $2.7 billion in hedge fund-of-funds strategies and invests in event-driven, relative value and directional strategies. The deal almost doubled Mellon's $3.1 billion in hedge fund assets.