14 October 2016
Man Group plc (“Man Group”) today announces that it has entered into an agreement to acquire the entire issued share capital of Aalto Invest Holding AG (“Aalto” or the “Company”) (the “Acquisition”) and launched Man Global Private Markets (“Man GPM”), forming the firm’s private markets offering, which provides clients with access to longer term investments with a complementary risk reward profile to our current product suite.
Aalto is a US and Europe-based real asset focused investment manager with $1.7 billion of funds under management as of 30 September 2016. Aalto will form the real assets platform of Man GPM. Founded in 2010 by Mikko Syrjänen and Petteri Barman, Aalto specialises in the management of real estate equity and debt strategies including direct investments in single family homes in the US and lending to commercial and residential real estate in Europe and the US. Aalto has a strong track record across its differentiated product range, and serves a client base of predominantly large institutional investors.
The Company, which is wholly-owned by its founders and current and former senior staff members, has demonstrated a compelling growth trajectory having grown fourfold over the last four years. Aalto has 33 employees and is headquartered in London, with offices in the US and Switzerland. The Acquisition is expected to complete in January 2017, subject to regulatory approvals and other customary conditions.
The Board of Man Group believe the Acquisition provides attractive strategic, commercial and financial benefits to Man Group and its shareholders. These include:
- Supporting the launch of Man GPM, providing a core component for the long term expansion into private markets strategies;
- Broadening and diversifying Man Group’s investment management capabilities giving the firm’s clients access to a range of strongly performing, differentiated real assets strategies;
- Further expanding Man Group’s presence in the US, through Aalto’s US-based investment team and strategies;
- Alignment of Aalto and Man Group’s shareholders with 89% of the maximum consideration payable to Aalto’s shareholders dependent on performance metrics measured between one and eight years after closing.
Launch of Man GPM
Man believes that building a private markets business over time represents an attractive opportunity for clients and shareholders. Man will have the ability to offer its clients a broader range of investment strategies to complement existing capabilities in public markets. Private market strategies are run in long duration funds, providing a stable source of revenues, while continuing to diversify Man’s product offering and offering further options for growth.
Man GPM will over time develop strategies across private markets such as real estate, credit, and infrastructure. On completion of the Acquisition, Aalto will form a central component of Man GPM, providing a core platform upon which the firm can develop this new offering for clients.
The Aalto management team will continue under the leadership of the Company’s founders. In addition, Mr Barman and Mr Syrjänen will be appointed Co-Heads of Real Assets within Man GPM, taking on a broader role in the strategic development of Man GPM’s offering in real assets. No change will be made to Aalto's investment process as a result of the Acquisition and investment independence will be maintained. Mr Barman and Mr Syrjänen will report to Jonathan Sorrell, President of Man Group, and will join Man Group’s Executive Committee.
The Acquisition supports Man Group’s continued focus on expanding and diversifying its offering for clients as well as growing operations in the US.
Commenting on the Acquisition Luke Ellis, CEO of Man Group, said:
“We are delighted to announce the acquisition of Aalto, which will be instrumental in the development of Man Global Private Markets, our new private markets capability. In line with our strategy to continue to diversify the firm and our offering for clients, this private markets capability is complementary to our broad offering in liquid strategies. As Co-Heads of Real Assets, Petteri and Mikko will work with Jonathan Sorrell to help to grow this area of the business, which will offer investors exposure to longer duration capital products and benefit from Man Group’s world class infrastructure, broad investment expertise and global resources.”
Petteri Barman, Co-Founder and CIO of Aalto, said:
“Joining Man Group is a compelling opportunity for us and our investors, as we believe that the firm is the ideal strategic partner for the next phase of Aalto’s development. The firm has a history of successfully integrating complementary businesses, while recognising and supporting their individual expertise, investment processes, and culture. We are excited to work with Man Group to further grow and enhance our business while retaining Aalto’s core purpose and independent approach to investing.”
Mikko Syrjänen, Co-Founder and CEO of Aalto, said:
“We are excited to partner with Man Group, and to combine Aalto’s investment expertise and capabilities with the firm’s institutional framework and global resources. Since its foundation, Aalto has operated a client-focused business model over multiple market cycles. We are now at the point in our evolution where the additional infrastructure and diverse investment expertise available at Man Group, as part of Man GPM, enhances our business and enables us to create significant value for existing and future clients. We are delighted to be working with an organisation that will enable us to preserve our entrepreneurial culture.”