17th Feb 2020 07:55
(Alliance News) - Jupiter Fund Management PLC on Monday confirmed the potential GBP370 million all-share deal for Merian Global Investors.
Jupiter will be issuing Merian shareholders 95.4 million shares, giving Merian shareholders an approximate 17% stake in the combined company. There is also an additional deferred payment of up to GBP20 million depending on performance targets being met.
Merian had asset under management of GBP22.4 billion as of the end of 2019, and the merger will create a company will assets of GBP65 billion.
Jupiter, a member of the FTSE 250, said the deal "significantly enhances" its UK investment capability, and widens the range of investment services available to clients.
Jupiter expects the merger to bring significant cost savings, adding a low to mid-teen benefit to underlying earnings per share in 2021. This boost will then increase from 2022.
The number of GBP1 billion or more funds within the group will expand to 16 from 10, the company continued, with the top five funds make-up of the company falling to 33% of assets under management from 46%.
Jupiter's Chief Executive Andrew Formica said: "This is an exciting acquisition that enhances our position as a leading UK asset manager, provides increased scale and diversification into attractive product areas, and creates stronger future growth prospects for the business. It is also consistent with our strategic priorities, adding strong investment talent with a similar culture and investment philosophy.
"The addition of Merian is compelling for all stakeholders. With this acquisition, our business will benefit from an increased capacity to attract, develop and retain high quality talent, backed by further investment in our platform and technology."
"In turn, we will be able to offer a wider choice of strongly performing active investment strategies to our clients, while shareholders will benefit from a highly earnings accretive deal delivered through substantial cost synergies," Formica continued.
His counterpart at Merian, Mark Gregory, added: "Jupiter is a great strategic and cultural fit with our business. It has a market leading brand with a clear focus on high conviction, active asset management which is entirely consistent with our own.
"I believe the enlarged business will be more strongly positioned to offer greater choice and investment performance to clients and continue to meet clients' ever-evolving needs."
By George Collard; [email protected]
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