Nomura Said to Seek Stake in American Century for $1 Billion

Updated on
  • Japanese firm seeking to expand into U.S. retail markets
  • Purchase from CIBC said due to take place in early 2016

Nomura Holdings Inc., Japan’s biggest brokerage, plans to pay about $1 billion for a stake of around 40 percent in U.S. money manager American Century Investments, according to a person familiar with the matter.

The purchase from Canadian Imperial Bank of Commerce would take place early next year, the person said on Monday, asking not to be identified because the matter was confidential. Details could be announced as early as the same day if an agreement is reached, the person said.

Buying the stake would be Nomura’s biggest overseas investment since it acquired Instinet Inc. for $1.2 billion in 2007. The Japanese firm is seeking to expand its capabilities to sell products to pension funds and insurers, and enter private banking and retail markets in the U.S., Chief Executive Officer Koji Nagai said in materials for an investor presentation on Dec. 1.

Kenji Yamashita, Nomura’s Tokyo-based spokesman, declined to comment. No comment was immediately available from American Century Investments or CIBC.

CIBC agreed in 2011 to buy 41 percent of Kansas City, Missouri-based American Century Investments from JPMorgan Chase & Co. for $848 million. The money manager was founded in 1958 by the late Jim Stowers Jr. and channels more than 40 percent of its profits to research to help cure genetically-based diseases, according to its website. It had about $141 billion of assets under management as of February 2014.

Nomura plans to sell investment trusts incorporating Japanese and Asian shares to individual investors in the U.S. through American Century Investments’ nationwide sales network, the Nikkei newspaper reported earlier.

To bolster profitability, the Tokyo-based brokerage is seeking to expand in faster-growing businesses outside of its home country. It bought ING Groep NV’s Taiwanese investment unit last year, becoming the first Japanese asset manager to operate in the market. Nomura also established a fund-management venture with China’s Shenzhen Hua Xia Ren He Capital Management last year.

(Updates with background on Nomura's acquisition from third paragraph.)
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