Man Group shares soared more than 10 percent and led the European stock markets after the asset manager delivered welcome news to its long- suffering shareholders Friday by announcing a 6 percent leap in funds under management and the $25 million acquisition.
The takeover of Aalto, which has $1.7 billion in funds under management (FUM), will help the U.K. alternatives asset manager expand and diversify its product offering and broaden its customer reach inline with its long-term strategic plans. In addition to the $25 million upfront payment, the deal has a maximum earn-out potential of $207 million over 8 years.
Aalto will form a key part of the Man Global Private Markets (Man GPM) division, unveiled Friday, which will capitalize on Aalto's real estate equity and debt strategies platform and drive the U.K. asset manager further into the arms of institutional clients and away from its traditional retail core.
Man Group's surplus regulatory capital balance will drop to around $300 million once the acquisition and a share buyback of up to $100 million are factored in, from a balance of $479 million as of 30th June.