Federated Investors will acquire Clover Capital Management, a Rochester, N.Y.-based value equity boutique, said Federated spokeswoman Meghan McAndrew.
The deal, expected to close in the fourth quarter, calls for Federated to make an initial payment of roughly $36 million. Future payments contingent on Clovers AUM growth over the next five years could lift the total purchase price to $57 million.
Clovers $2.8 billion in assets under management are in separately managed accounts as well as common and collective portfolios. In addition to serving institutional and high-net-worth clients, the firm serves as a subadviser to several mutual funds.
After the deal closes, Clover will manage three new value equity mutual funds large cap, midcap and small cap to be introduced by Federated.
Michael E. Jones, CEO and CIO of Clover Capital, and other key employees have signed employment agreements with Federated. The Clover brand name will continue, but Clover will not be a separate corporate entity.