Expected to be finalised by the second quarter of 2015, the deal will see all four of NewSmith’s equity strategies – UK, European, Global and Japan – integrated into Man GLG.
According to Man Group, the deal – the financial details of which were not disclosed – bolsters GLG’s equities business, strengthens its long-only strategies and, in particular, adds a “high calibre, Tokyo based Japan Long Short Equity Strategy to Man GLG’s product line”.
The deal also serves to strengthen Man Group’s relationship with Sumitomo Mitsui Trust Bank (SMTB), which it says is a key client of the group and is also 40% owner of NewSmith. The other 60% of the business is owned by NewSmith’s founders.
According to a notice put out by SMTB, the NewSmith deal forms part of a broader strategic relationship agreement between it and Man group, an arrangement that “further enhances the business relationship with Man Group in respect of investment management and fund administration services”.
Under the agreement, the scope of the alliance has been expanded, SMTB said, “from product distribution to product co-development, marketing and fund administration services”.
It added: “The expanded alliance with SMTB and the enhanced capability in asset management through the acquisition of NewSmith will contribute to Man Group’s presence in the market as a global investment management company.”
Luke Ellis, Man Group president, reiterated the point saying: “The acquisition brings a new dimension to the firm, including a Japanese hedge fund and an excellent team in Tokyo, as well as adding further scale to our London business. It is testament to the Man GLG team that we have received such a strong endorsement from SuMi TRUST, a key strategic partner of Man Group, and we are delighted that our relationship will be further enhanced following this acquisition.”
According to Paul Roy, NewSmith’s chairman, All of NewSmith’s investment team and all four funds are going over “exactly as is” and will continue in the same manner.
But, he added, they will benefit from the additional marketing and distribution firepower that Man Group brings to the table.
According to the press release, both Roy and NewSmith CEO Ron Carlson will work with Man GLG over the next twelve months “to ensure a seamless management transition and integration”.
