Terms were not disclosed.
Mr. Dromer said in an interview that the acquisition was a strategic move to boost U.S. third-party institutional assets. Overall U.S. assets account for about $46 billion of Aviva Investors’ $358 billion in total assets under management, but external assets are only a scant portion of U.S. AUM.
River Road managed $3.6 billion as of Nov. 30.
Attracting third-party institutional clients in the U.S. is a “massive priority” in the company’s push to add external retirement assets. Globally, about 25% of Aviva Investors’ assets are external. Mr. Dromer hopes that figure will reach 50% within about three years.
Mr. Dromer said he was attracted to River Road because of its performance, quality of institutional client base and how well he believes it will fit with Aviva’s existing business in the U.S. River Road will take advantage of Aviva’s business development and infrastructure globally, while providing Aviva with its first equity capabilities in the U.S.
River Road’s founders — CEO/Chief Investment Officer James C. Shircliff, President R. Andrew Beck and Executive Vice President Henry W. Sanders III — and the firm’s investment process will remain in place after the acquisition. The firm will continue to be based in Louisville, Ky. — Aviva’s U.S. headquarters is in Des Moines, Iowa — and there are no plans to rebrand the firm.
Aviva Investors has the “spirit of the boutique” with its alpha-generating teams, Mr. Dromer said, adding that those teams “should feel they are completely empowered to create value from their processes.”
The deal is expected to close this quarter.