Credit Suisse Group, in a deal finalized today, acquired a roughly 82% stake in Asset Management Finance Corp., a provider of “non-intrusive” financing to money management firms, from National Bank Financial Group of Montreal for US$384 million, said Brian Finn, chairman of Credit Suisse’s alternative investments business.
In a joint interview with Mr. Finn, Norton Reamer, AMF’s president and CEO, said Credit Suisse will also extend a loan of $250 million to AMF, a case of “perfect timing” as the firm needed an infusion of equity capital to continue its recent fast-paced growth.
As of today, AMF had made combined investments of $300 million in 12 money management firms, in exchange for time-limited shares of those firms’ revenues. With the new Credit Suisse loan, AMF will have roughly another $300 million of immediate cash on hand, which with additional borrowing will give AMF as much as $1 billion to invest, if needed, Mr. Reamer said.
That enhanced financial muscle will allow AMF to do individual deals of $75 million to $100 million, more than twice the scale of its initial deals, he said.
Mr. Finn said Credit Suisse will leverage its global reach, and relationships with investment managers around the world, to help AMF grow. Gregory P. Meredith, a managing director and head of Proctor NBF Capital Partners, said his firm will retain a 10.5% stake in AMF, and anticipates benefiting from that growth.
In a separate filing today, NBF said it anticipates reporting a C$65 million (US$62 million) pretax gain for the current quarter on the sale of the bulk of its stake in AMF. Mr. Finn said Japan’s Tokio Marine & Nichido Fire Insurance Co. will continue to hold a 5% to 6% stake in AMF, with Mr. Reamer and other AMF professionals holding the remainder.
