The number of announced money manager acquisitions globally was down 18% in 2014 from the previous year, with 99 deals taking place, said a report from investment banking firm Freeman & Co.
The report found activity in the U.S. was up, with 72 announced transactions representing a 4% increase from 2013. But it found 40 announced transactions in Europe in 2014, a 5% decrease from 2013. Several of the deals were double counted because they were cross-border transactions.
“There continues to be a good market for M&A activity in the U.S. market and that should continue in 2015,” said Gilbert Dychiao, a managing director at Freeman, in an interview.
But Mr. Dychiao said the depressed M&A picture in Europe will likely continue this year because of the uncertain economic climate.
Money management transactions announced in 2014 represented nearly $2 trillion in assets under management, an increase of 8% from 2013, the report said.
Mr. Dychiao said the report does not track the value of individual transactions because those numbers are not always disclosed.
Mr. Dychiao said M&A activity in 2015 will be increasingly concentrated among top money managers.
“They have the size and scale to make acquisitions and close distribution gaps,” Mr. Dychiao said.
Mr. Dychiao said managers that offer specialized investment strategies, such as smart beta, alternatives, exchange-traded funds and asset allocation, will increasingly be the subject of M&A activity because they address investors’ needs for downside protection and diversification.