In early October, Morgan Stanley agreed to acquire Eaton Vance for $7 billion, which will increase Morgan Stanley's AUM to $1.2 trillion, while activist hedge fund Trian Fund Management disclosed it purchased 9.9% stakes in money managers Janus Henderson and Invesco. These transactions followed 15 money management deals in the third quarter of 2020, a 25% increase from the previous quarter. In the third quarter of 2019, there were 13 transactions. Assets under management involved in the latest-quarter transactions totaled $263.8 billion, down 96% from $6.7 trillion in the previous quarter. The second quarter included a 22.4% stake sale of BlackRock Inc. by PNC Financial Services Group, which increased total AUM involved in M&A transactions significantly.
In the third quarter, J.P. Morgan Chase agreed to pay 178 million yuan ($26 million) to purchase a 20% stake from Shanghai Waigaoqiao Free Trade Zone Group to increase its ownership in its Chinese securities joint venture China International Fund Management Co. to 71%. AMP said it will repurchase a 15% stake of AMP Capital from Mitsubishi UFJ Trust and Banking for A$460 million ($329 million). BrightSphere Investment Group agreed to sell its 75.1% ownership in Barrow, Hanley, Mewhiney & Strauss to Perpetual Ltd. for $320 million and also agreed to sell its equity interest in Copper Rock Capital Partners to Copper Rock executives and Spouting Rock Asset Management for $15 million. African Rainbow Capital Financial Services will take a 25% stake in Sanlam Investments for 815.2 million rand. Mubadala Investment Co agreed to invest $2 billion in Silver Lake's new 25-year investment strategy and took a minority stake in the firm.
There also were 10 deals in the quarter that did not involve money managers. KKR & Co. agreed to acquire retirement and life insurance company Global Atlantic Financial Group for roughly $4.4 billion. Investment consulting firm Aksia will acquire real estate consultant Alignium in an all-cash purchase.
Empower Retirement agreed to acquire Fifth Third Bank’s record-keeping business as well as the $167 billion retirement plan business of Massachusetts Mutual Life Insurance Co. for $3.4 billion. Empower will provide record-keeping and administrative services while Fifth Third offers plan-level investment advisory. Empower Retirement will remain as the second largest DC record keeper by AUM; the deal with Massachusetts Mutual Life Insurance Co. will increase Empower Retirement's assets under administration to $835 billion from $667 billion.
All information is based on transactions reported by Pensions & Investments’ global reporting staff.
