Man Group completes FRM acquisition
Man Group has completed its acquisition of FRM Holdings, a global hedge fund research and investment specialist.
Man Group has completed its acquisition of FRM Holdings, a global hedge fund research and investment specialist.
The deal, which is costing Man up to $142.8m, means the two firms' combined multi-manager business now has total funds under management of around $19bn, making it the largest independent non-US based "fund of hedge funds".
The UK hedge fund group will pay a maximum of $82.8m in cash, net of total net assets it acquires and dependent on asset retention, and it will also pay out a 47.5% share of performance fees attributable to FRM's existing funds under management over three years, up to $60.8m.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
![https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748.jpg](https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748-320-80.jpg)
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
"By combining the complementary investor bases of the two businesses and pairing FRM's well regarded investment process with Man's managed accounts infrastructure, we can increase revenues with no material change to Man's current cost base," said Man's Chief Executive Peter Clarke in April, when the deal was first announced.
"The transaction has been structured so that the consideration adjusts in line with asset retention, to ensure an attractive return for our shareholders."
The company said that the deal would achieve cost savings of $45m a year from operational synergies in the combined group, which in turn would generate double digit growth to Man's adjusted management fee earnings per share in 2013. The internal rate of return from the acquisition is expected to be well in excess of Man's cost of capital.
Man's share price rose 0.73% to 68.60p by 14:18.
NR
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
-
Skipton launches a retirement bond with monthly income – is it any good?
The building society has launched a new three-year fixed-rate bond for those aged 66 and over. Can it boost your retirement income?
By Katie Williams Published
-
Pensions: 140,000 pensioners to be hit by surprise tax demand
Tens of thousands of pensioners will be written to over the summer because their pensions have gone above the frozen income tax thresholds
By Chris Newlands Published