Aberdeen Asset Management announces U.S. and European acquisitions
Aberdeen Asset Management PLC ("Aberdeen") announces that it has reached an agreement to acquire 100 percent of the share capital of Artio Global Investors Inc. ("Artio"), a publicly listed asset management company (the "Transaction").
The purchase consideration of approximately $175 million is based on a price of $2.75 per share and represents a premium of $34 million over Artio's unaudited net asset value as of Dec. 31, 2012. Artio is debt-free and had cash and seed investments of $136 million on its balance sheet as of Dec. 31, 2012. The purchase price will be payable in cash, financed out of Aberdeen’s existing cash resources, on completion of the Transaction.
This acquisition will expand Aberdeen’s North American business, deepen its distribution network in the region and add to its existing fixed income capabilities. The transaction is consistent with Aberdeen’s stated strategy to identify suitable, quality businesses to complement the Group’s organic growth.
Artio manages assets of approximately $14.3 billion on behalf of a diversified retail and institutional client base. Based on Artio’s fourth quarter results, annual run-rate revenues were approximately $71 million, as of Dec. 31, 2012. Artio’s assets under management ("AuM") include mutual fund assets of $7.2 billion. Artio comprises a $9.8 billion fixed income business which has delivered top quartile performance across its range of strategies including highly rated Global High Yield and Total Return Bond products and a $4.5 billion international and global equities business which will be transitioned to Aberdeen’s top-performing global equity process post-completion. Artio’s Global High Yield and High Grade teams are expected to join Aberdeen on completion of the Transaction.
The key benefits of the Transaction for Aberdeen are:
- adds significant scale to existing U.S. fixed income business and complements organic efforts to expand distribution in the U.S., a priority growth market for Aberdeen;
- adds established global high yield and U.S. total return offerings to Aberdeen which will complement Aberdeen’s existing fixed income expertise;
- provides access to Artio’s distribution channels with a deeper penetration of the U.S. intermediary market, particularly the broker dealer & registered investment adviser segments which will also be of benefit to Aberdeen’s existing product range; and
- the Transaction is expected to be earnings enhancing from the outset.
The Transaction, which is currently expected to close by the end of the second quarter or early in the third quarter of 2013, is subject to customary closing conditions, including, U.S. antitrust approval, approval of a majority of Artio Global shareholders and approval of certain Artio Global mutual fund shareholders. As part of the Transaction, three of Artio‘s largest shareholders (representing approximately 45% of the total shareholding in aggregate) have entered into Voting Agreements providing that they will vote in favor of the Transaction.
Commenting on the Artio Transaction, Martin Gilbert, Chief Executive of Aberdeen Asset Management, said:
"This transaction is in line with Aberdeen’s strategy of undertaking infill acquisitions that will assist with growing our business organically. It will be of benefit to our North American business, a region we view as a key growth market for Aberdeen. The integration of Artio’s operations will strengthen further our U.S. fixed income expertise, in particular the addition of U.S. global high yield and total return products, and will help to broaden and deepen our distribution network in the U.S."
Aberdeen is also pleased to announce today that is it has agreed to acquire a 50.1% stake in SVG Advisers (SVGA), a wholly owned subsidiary of SVG Capital plc (SVGC), an international private equity investor and fund management business listed on the London Stock Exchange. This business will be combined with Aberdeen’s existing private equity capability to create a substantial private equity fund of funds business. There is no direct impact on Aberdeen’s U.S. business.
J.P. Morgan Limited (which conducts its UK Investment Banking activities as J.P. Morgan Cazenove) is acting as financial adviser and corporate broker to Aberdeen in connection with the Transaction, and Willkie Farr & Gallagher LLP is acting as Aberdeen’s U.S. legal advisor.
For further information, please contact:
Katie Cowley (U.S.) firstname.lastname@example.org
Aberdeen Asset Management 215-405-2423
James Thorneley (UK) email@example.com
Aberdeen Asset Management 020 7463 6323
About Aberdeen Asset Management
Aberdeen is an asset management company managing $314 billion of third party assets from our offices around the world, as of December 31, 2012. Our clients access our investment expertise drawn from three main asset classes: equities, fixed income and property, as well as tailored solutions. We package our skills in the form of segregated and pooled products across borders. We invest worldwide and follow a predominantly long-only approach, based on fundamentally sound investments.
Further information about Aberdeen can be found at www.aberdeen-asset.us