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Wall Street News

Asset Management M&A Deals? You Need Buyers

October 31, 2016

Persistent withdrawals from actively managed stock mutual funds and investors’ fast adoption of index-tracking funds gave rise to the notion that the asset management industry could undergo a wave of consolidation.  That idea was strengthened when U.K.-based asset manager Henderson Group bid $2.6Bn for Denver-based Janus Capital Group.

 

However, it looks like there aren’t many interested buyers in small- and mid-sized asset managers.  So much for the asset-management merger frenzy.  For one thing, how can potential acquirers assign a value to fund firms that are experiencing big outflows.  And, according to Citigroup’s William Katz: “there may not be many buyers” at premiums for fund companies dealing with redemptions and modest performance issues.