UK’s Man Group to buy Numeric Holdings

24 June 2014   Category: News, Global, United Kingdom   By Derek Au

UK-based alternative investment manager Man Group, which has AUM of US$55 billion, has agreed to pay as much as $494 million to acquire US-based quantitative equity manager Numeric Holdings, strengthening its presence in North America.

Man will stump up $219 million in cash and could opt to pay a group of Numeric managers and employees up to $275 million in five years under an option agreement to acquire management interests and profit interests, depending on the performance of the business. Man has the right to choose to pay in cash or by issuing new shares in exercising the option.

The deal is subject to approval by Man’s shareholders, who will converge at a general meeting held as soon as the end of August. Man will fully incorporate the results of Numeric after the completion of the deal, which is expected to close in September.

Numeric combined with Man’s existing quantitative investment business AHL will create a globally diversified investment platform with more than $25 billion in AUM.

Commenting on the acquisition, Manny Roman, Man’s chief executive officer, said: “The transaction provides us with the opportunity to advance two of our core strategic objectives: first, to build a diversified quantitative fund management business with significant assets in fundamentally-based quantitative strategies, and second, to develop further our presence in the US market. Man’s strategy is to provide the optimal infrastructure and environment for its investment divisions, enabling entrepreneurial asset management focused on delivering attractive risk-adjusted performance for clients. Numeric is well positioned to benefit significantly from our scale and resources.”

Mike Even, chief executive officer of Numeric, added: “Our key criteria from the outset was to find a new partner with a strong cultural fit who would preserve complete independence of our investment process and provide strategic support. We are excited and energised by this transaction and look forward to serving our clients with the support of Man.”

Numeric, founded in 1989, is a privately-owned company with 74 employees. It has AUM of $14.7 billion, which is exposed to a range of long-only and long-short, fundamentally-based quantitative strategies.