Man Group Hedge Fund Buys $1.2 Billion NewSmith Equities ManagerWill Wainewright
Man Group Plc, the world’s largest publicly traded hedge-fund manager, agreed to buy the equities management business of NewSmith to expand in Tokyo and London.
Man Group, which manages $72.3 billion, plans to complete the deal in the second quarter, it said in a statement on Friday. London-based NewSmith, with $1.2 billion of funds under management, is 40 percent-owned by Sumitomo Mitsui Trust Holdings Inc., Japan’s fourth-biggest bank by market value, which said it supports the deal in a separate statement.
“The acquisition brings a new dimension to the firm, including a Japanese hedge fund and an excellent team in Tokyo as well as adding further scale to our London business,” Man Group President Luke Ellis said in the statement.
Chief Executive Officer Manny Roman has been expanding Man Group through acquisitions, adding more than $16 billion in assets last year. Man Group said in December it would buy Silvermine Capital, a U.S. leveraged loan manager, following acquisitions of U.S. fund-of-hedge-funds manager Pine Grove Asset Management and Numeric Holdings, a Boston-based quant manager.
Man Group shares were trading up 1.5 percent to 186.5 pence as of 10.35 a.m. in London.
NewSmith’s Tokyo-based long/short equity hedge fund will join GLG, a unit of Man Group, as part of the deal, the terms of which weren’t disclosed.
Sumitomo Mitsui Trust already has ties with Man Group through its holding in the U.K. firm’s FRM unit, the Japanese bank said. A new “strategic relationship agreement” will see the two firms work more closely in all of Man Group’s businesses, it said.
The agreement enables Sumitomo Mitsui Trust to offer Man Group products to its clients, it said, as government efforts to spark inflation prompt Japanese investors to take on more risk in search of higher returns.
NewSmith’s Chairman Paul Roy and CEO Ron Carlson will work with Man Group over the next twelve months to help the integration, according to the statement.