BNY Mellon Asset Management's says its two recent acquisitions -- a 20% stake in New York-based multi-strategy private equity firm Siguler Guff & Company and 100% of London-based Insight Investments -- are "strategically important" for its Asia business.
Siguler Guff sources "a big portion" of its $8 billion in assets from Asia, says a BNY Mellon spokeswoman. Moreover, clients in Asia looking for access to distressed funds and other specialist private equity offerings "will benefit from BNY Mellon AM's access to Siguler Guff's high-quality products and strategies", she adds.
Ron O'Hanley, president and chief executive of BNY Mellon AM, says: "This transaction formalises our ties with Siguler Guff and significantly adds to our 'alpha' capabilities." The two companies formed a strategic alliance in January, when Siguler Guff engaged BNY Mellon AM to distribute Siguler products globally.
"In the aftermath of the financial crisis, institutional and individual investors are seeking more diversification and increasing exposure to alternatives," adds O'Hanley. "Moreover, the stress in large-cap buyout investing has led investors to rethink and re-allocate private equity investments."
Siguler Guff will remain an independent company and joins a number of other boutique firms under BNY Mellon AM's 'multi-boutique' structure. The current executive team and founding partners, George Siguler and Drew Guff, will continue to manage the firm. O'Hanley becomes a member of the Siguler Guff governing board, and there will not be any changes to Siguler's existing office locations.
BNY Mellon AM would not disclose how much it paid for the Siguler Guff stake.
Insight Investment, meanwhile, has a "negligible proportion" of its $133 billion in AUM contributed from Asia and does not have any offices in the region. Nevertheless, the £235 million ($383 million) acquisition is consistent with BNY Mellon AM's strategy to create "broad-based solution capabilities", says the spokeswoman.
"Through this initiative, we will be among the few global asset managers that are in a position to provide the depth of expertise for a comprehensive suite of solutions to investors in the region," she adds.
Insight, previously owned by UK-based Lloyds Banking Group, specialises in liability-driven investment (LDI), active fixed income and absolute returns strategies. The takeover will make BNY Mellon AM one of the largest managers of UK pension funds and UK mutual funds, says Jonathan Little, vice-chairman of BNY Mellon AM.
The two deals reflect ambitions highlighted in October 2008 by Little, who is responsible for the group's business outside North America. At the time, for example, he identified private equity and LDI as opportunities.
Both recent acquisitions also fit with BNY Mellon's traditional approach of gathering specialist 'boutique' asset managers within the group and focusing on institutional investment clients.