In line with its strategy to enhance market share and provide
best-in class investment ideas to its clients,
Affiliated Managers Group Inc.
) announced two deals. These two announcements facilitated nearly
a 5% rise in the company's shares in an intra day trading on
Friday, to reach $190.98. Notably, the financial terms for both
the deals were not disclosed.
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Of the two transactions, one relates to Affiliated Managers
signing an agreement with Aviva Investors North America Holdings,
Inc. to acquire full equity interest in River Road Asset
Management, LLC. Aviva Investors North America Holdings is a
subsidiary of U.K. based insurer
). Headquartered in Louisville, KY, River Road has nearly $11
billion in assets under management (AUM) and offers
value-oriented equity strategies. The deal is likely to be
completed next month.
Additionally, River Road has a business relationship with Aston
Asset Management, LP, a part of AMG Funds operation. Following
the completion of the deal, River Road will continue to offer
sub-advisor services to six mutual funds in the Aston Funds
family. Further, River Road's management will own a significant
part of the equity and continue to control the firm's day-to-day
The second deal pertains to Affiliated Managers acquiring a
minority stake in EIG Global Energy Partners, LLC. Based in
Washington, EIG is a global alternative investment firm that
specializes in private investments in the energy sector, with
approximately $16 billion in AUM (as of Dec 31, 2013). The
transaction is expected to close by the third quarter of 2014.
EIG has offices in Houston, Hong Kong, London, Rio de Janeiro,
Sydney and Seoul. Further, the firm's client base comprises
prominent pension plans, insurance companies, endowments,
foundations and sovereign wealth funds from nearly 20 countries.
We believe Affiliated Managers' decision to further expand bodes
well with its long-term growth plan. Presently, the company is
targeting investments in alternatives and global strategies,
given the strong investors' preferences for the same. As of Dec
31, 2013, the company had cash and cash equivalents of $469.6
Currently, Affiliated Managers carries a Zacks Rank #3 (Hold).
Some better-ranked asset managers include
Calamos Asset Management Inc.
). Both of these carry a Zacks Rank #1 (Strong Buy).