Updated with correction
Artisan Partners LP's initial public offering earlier this month not only raised $332 million but also increased the chances other money managers could follow its lead and issue their own IPOs.
“Bravo to them,” Elizabeth B. Nesvold, founder and managing partner at New York-based investment banking boutique Silver Lane Advisors LLC, said of the March 7 IPO, which was Artisan's second attempt to go public. “The second time is a charm.”
“Previously there wasn't a good window” for a money manager IPO, Ms. Nesvold said. “Some may say it's still too early to tell, but this IPO opens the door for further reflection. Artisan proving they can come back to the market may give others thinking about tapping the public markets the courage to re-enter.”
Milwaukee-based Artisan sold 11.1 million shares of stock at $30 per share on the first day of the offering; it had set the price range between $27 and $29. Artisan closed on March 15 at $37.61.
“It marks a turning point,” agreed Burton Greenwald, managing director and independent management consultant at B.J. Greenwald Associates, Philadelphia. “Other publicly traded managers have been strong, reflecting the exuberance in the marketplace. Just look at the surge in assets under management since the start of the year. It's not specific to Artisan; it reflects the temper of the marketplace.
“Anyone with any thoughts (of going public) is looking at this,” he added.
For one, Old Mutual PLC, London, which has backed off plans to have its U.S. asset management business go public, could decide to go ahead. “Don't count Peter Bain (OMAM president and CEO) and Old Mutual Asset Management out for an IPO down the road,” Ms. Nesvold said. “If anyone can mastermind a successful spinoff to the public markets, Bain can do it.”
“There's no magic,” Bob Batchelor, director of marketing and communications at Artisan, said of the timing of the offering. “We weren't pressed into doing this. It's not a liquidity event. The partners didn't sell their shares. It's just another step in the evolution of the firm ... part of an overall strategy.”
Eric Colson, Artisan's CEO, could not be reached for comment.
The shares sold in the IPO were additional ones, and amount to about 20% of the firm's total shares, Mr. Batchelor said in the interview; employee owners and private equity firm Hellman & Friedman, which bought a stake in the equity manager in 2006, did not sell shares. Officials at Hellman & Friedman would not comment.