Nuveen Investments has agreed to acquire a 60 per cent stake in Gresham Investment Management, which has around $14 billion in assets under management, for an undisclosed amount.
Following the acquisition, the Gresham management and investment team will retain a significant ownership interest, and the firm will continue to operate independently. Gresham, which was founded in 1992, has a focus on commodities which Nuveen views as a “critical and growing component of the broader marketplace.” Gresham already serves as sub-advisor to the Nuveen Diversified Commodity Fund.
The transaction, while subject to customary closing conditions, is expected to close by the end of the year.
At the end of October 2011, Nuveen Investments managed $207 billion for institutions, individual investors and intermediaries.
Many predicted that mergers and acquisitions among financial services would rise this year, as confidence in the economy rose and unlocked pent-up demand for deals, after years of firms focusing on rebuilding their balance sheets following the financial crisis.
Within the asset management sector, PricewaterhouseCoopers’ annual M&A outlook predicted earlier this year that most consolidation would be concentrated among small- and mid-sized players.
The Nuveen and Gresham deal comes just after Evercore Partners, the New York-listed investment banking and investment management firm, agreed to buy a 45 per cent non-controlling stake in ABS Investment Management for around $45 million in cash. ABS is a fund of hedge funds manager with around $3.5 billion of hedge fund assets under management.
However, renewed uncertainty in the third quarter may have caused some companies to hit the breaks on any planned deals, and data from KPMG shows that merger and acquisition activity in the US investment management industry declined in Q3 on both a linked-quarter and year-over-year basis.