Man Group shares dive 6% on Q3 outflows

Funds under management at Man Group grew by 14% in the third quarter, supported by the acquisition of FRM, although the firm saw increased net outflows of $2.2bn for the period.

Shares in the fund giant dropped 5.83% to 87.16p on the outflows and subdued sales for the period during which Man Group acquired rival hedge fund firm FRM, adding $8.3bn to the firm’s AUM bringing it to $60bn.

However, overall the group saw $2.2bn outflows, an increase from the second quarter figure of £1.4bn, due to flows from long-only products in the GLG arm and institutional funds of funds.

Long only funds’ AUM shrunk by $100m in the quarter with $300 of net outflows largely offset by FX movements but the group also warned it had been notified of further redemptions from the long-only arm of $800m for October.

Funds under management in GLG alternatives saw net outflows of $400m, said an interim management statement, which was offset by performance and FX.

However the European long short, macro, euro distressed and global convertibles strategies saw positive flows.

Peter Clarke (pictured), chief executive of Man Group, said: “Man’s funds under management increased in the quarter, driven by the acquisition of FRM which completed in July. This transaction has created the largest non-US based hedge fund of funds business and I am pleased to say that integration has progressed quickly and efficiently with positive feedback from clients.

“The flow environment continues to be challenging and this was reflected in lower sales in the quarter. Redemptions were in line with the levels experienced in the second quarter which resulted in increased net outflows, albeit in lower margin product lines. Investor sentiment, and consequently the outlook for flows, continues to be subdued.”


This article was first published on Investment Week

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