Jupiter Fund Management is reportedly in advanced talks to buy Merian Global Investors just over 18 months since it was spun out from Quilter predecessor Old Mutual.
Bloomberg reported on Saturday morning that Jupiter, which has £45bn assets under management, was looking to pay less than £500m for Merian, which was acquired by private equity firm TA Associates in a £583m deal that completed in June 2018.
Fundcalibre managing director Darius McDermott said while the reports were surprising, there has been a growing trend of consolidation in asset management for the last decade.
“Jupiter chief executive Andrew Formica also has experience of these types of acquisitions during his time at Janus Henderson, notably when the firm acquired New Star Asset Management and Gartmore,” McDermott said.
Jupiter and Merian both bring strong UK teams
The businesses faced the most crossover in UK equities where both businesses have strong teams, he said. But he felt like the merger could be a good fit and positive for investors.
“Jupiter has what many consider to be the market-leading multi-asset franchise in the UK. The firm also has strong performance in European and Asian equities as well as a popular Strategic bond fund in the fixed income space.
“In addition to the UK, Merian excels in global equities and also has a strong specialist offering in the shape of its gold and silver fund, managed by Ned Naylor-Leyland.”
A timeline of Merian Global Investors
Richard Buxton, who had been chief executive of OMGI, the predecessor to Merian, had led the £583m buyout of the single strategy business from Quilter in 2018.
A month after the deal, Buxton rebranded the business as Merian Global Investors, naming it after 17th-century German scientist and artist Maria Sibylla Merian.
Later in the year, Merian launched the Chrysalis investment trust, which initially fell short in its IPO raising half the £200m it had been targeting, but now has a market cap of £431m.
Buxton stepped back from the helm of the business in January 2019 to focus on his portfolio management responsibilities. He is head of UK equities and manager of the Merian UK Alpha Fund.
In October 2019, Merian announced it had purchased the Kestrel multi-asset team led by John Ricciardi in its first deal since its spin out.
The first now has assets under management of £22bn.