Administration May 10, 2001

Europeans Buy More American Funds

October 18, 2000 (PLANSPONSOR.com) - European firms continued to "buy American," as Nicholas-Applegate and Alleghany Asset Management found themselves under new management this morning, the latest in a series of US money manager acquisitions which could mean transition headaches for plan sponsors.
Reported by

Allianz AG agreed to buy San Diego-based US stock-fund manager Nicholas-Applegate Capital Management for $980 million, though retention and performance incentives could double the size of the deal. Nicholas-Applegate put itself on the block this spring, and talks between the two have been rumored for more than a month now.

Nicholas-Applegate currently manages about $45 billion, making the deal worth about 2.4% of assets under management, without the incentive payments. Allianz acquired Pimco (which itself owns Oppenheimer Capital) earlier this year. 

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The Nicholas-Applegate Global Technology fund returned 494% last year, and was the top-performing mutual fund in the US, according to Dow Jones.

Meanwhile, ABN Amro Holding NV, the Netherlands largest bank, has agreed to buy Alleghany Asset Management for $825 million in cash. Alleghany controls $45 billion in assets, 80% of which are institutional funds. The deal expands ABN Amro’s managed assets 40% to $155 billion. Alleghany, with principal subsidiaries Montag & Caldwell and Chicago Trust Company, has 550 institutional clients.

ABN Amro currently owns the LaSalle Bank Group in Chicago, Standard Federal Bank in Michigan and New York-based European American Bank.

Both Allianz/Nicholas-Applegate and ABN Amro/Alleghany deals are expected to close in the first quarter.

This morning Amvescap PLC, which controls US fund families AIM and Invesco, was said to be in “advanced discussions” to acquire British fund manager Perpetual PLC for about $1.59 billion in stock/cash, according to The Wall Street Journal.

This year has seen a wave of foreign acquisitions of US money managers, including

  • CDC’s – $1.87 billion acquisition of Nvest
  • Old Mutual’s $1.46 billion acquisition of United Asset Management
  • UniCredito Italiano SpA’s $1.27 billion acquisition of Pioneer Group
  • Axa/Alliance Capital’s $3.5 billion acquisition of Sanford C. Bernstein
  • UBS AG’s $12.2 billion acquisition of PaineWebber
  • ING Groep NV’s $5 billion acquisition of Aetna Financial Services

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