British asset manager Henderson has reached an agreement to acquire 100% of Australian boutiques, Perennial Fixed Interest Partners (PFI) and Perennial Growth Management (PGM) from IOOF Holdings Ltd (“IOOF”) and the employee-shareholders of each company.
The two firms have combined assets under management of £5.5bn (€7.49bn) as at 31 March 2015.
In a separate transaction, Henderson has increased its ownership of 90 West Asset Management (90 West) from 41% to 100%. 90 West manages £0.2bn (€0.27bn) in global natural resources equities funds and segregated mandates.
Pan Asian AUM account now for 11% of the group’s total, passing from £4bn (€5.4bn) to £9.6bn (€13bn).
The 90 West transaction has been closed on 29 May 2015 and the Perennial acquisitions are expected to close in the fourth quarter of 2015.
Henderson highlighted that Perennial’s fixed income and equities expertise will significantly extend Henderson’s offering to Australian clients, adding domestic investment management capability to Henderson’s globally focused offerings and providing a broader platform for future growth in the Australian market.
Andrew Formica, chief executive of Henderson, said: “Developing our presence in Australia is a strategic priority for Henderson. These acquisitions will give us recognised domestic investment management capabilities to complement our global offering and take us into the Top 30 of Australian asset managers.
“They help us build scale in our Australian business well ahead of our previous expectations. On completion, we will more than double our AUM from Pan Asian clients and have around 40 investment professionals based in the region, managing money on behalf of local and international investors.
“This is another important step towards achieving our ambition to become a truly global asset manager.”
Henderson said that IOOF will receive “an upfront consideration and a deferred component dependent on future business performance, payable after two and four years.”
“In all three businesses, the employee-shareholders will receive a significant majority of their consideration through deferred earn-out structures to be paid four years post completion, with the quantum dependent on future business performance.
“Key investment professionals in all businesses have signed long term employment contracts with Henderson,” the firm also pointed out.
Henderson has announced it will continue to build out its distribution and business operations in Australia to deliver growth for new and existing businesses and teams.