Money manager M&A: Deals drop, assets skyrocket in Q4

Twenty-five money management deals took place in the fourth quarter, an 11% decrease from the previous quarter. In the fourth quarter of 2017, there were 31 transactions. AUM involved in the transactions totaled $780.92 billion, up 279% from $205.92 billion from the previous quarter. However, total assets involved decreased 41% from the same period a year ago.

In the fourth quarter, Invesco (IVZ) agreed to acquire OppenheimerFunds from Massachusetts Mutual Life Insurance for roughly $5.71 billion. The deal was expected to bring Invesco's total assets under management to more than $1.2 trillion, making it the 13th largest global investment manager and sixth largest U.S. investment manager. Commonwealth Bank of Australia announced the sale of its global money management business, Colonial First State Global Asset Management, to Mitsubishi UFJ Trust and Banking for A$4.1 billion ($2.9 billion). Intermediate Capital Group unit ICG Strategic Equity Advisors agreed to a $1 billion purchase of the majority of Standard Chartered's private equity investment portfolio, which will be managed by Standard Chartered spinout Affirma Capital.

Paulson & Co. announced it would purchase a 24.95% stake in $238 billion money manager BrightSphere Investment Group from HNA Capital Holding. Northill Capital is acquiring a 75% ownership stake in $28 billion investment outsourcing specialist Strategic Investment Group from private equity manager FFL Partners. Dyal Capital Partners acquired a minority ownership interest in $17 billion private equity manager American Securities.

During the fourth quarter, there were 12 deals that were institutional investing related but did not involve money managers. Goldman Sachs Asset Management agreed to acquire Rocaton Investment Advisors to expand its advisory and discretionary services for institutional clients, which had more than $600 billion in assets under advisement as of Sept. 30. Investment consulting firms Cafaro Greenleaf and Carroll Consultants agreed to merge, which would lead to a new client base of 300 retirement and group benefit plans with assets under advisement of more than $4.6 billion. Virtu agreed to acquire agency brokerage and trading analytics provider Investment Technology Group for about $1 billion in a cash deal. APG Groep agreed to sell its insurance subsidiary Loyalis to Dutch insurer ASR Nederland in a €450 million ($510.4 million) deal.

All information is based on transactions reported by Pensions & Investments' global reporting staff.

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