Janus to Merge With Henderson, Forming Asset Management Giant

Janus to Merge With Henderson, Forming Asset Management Giant

- in Business
208
0

“This is a transformational combination for both organizations,” said Dick Weil, the chief executive of Janus.

Credit
Adrees Latif/Reuters

Janus Capital Group and Henderson Group said on Monday that they would merge in an all-stock deal that would create an asset manager with greater global scale and about $320 billion of assets under management.

The combined company — to be called Janus Henderson Global Investors — would be worth about $6 billion based on market capitalization.

Janus, which lured William H. Gross after he left Pimco two years ago, is strong in North America, and it has $149 billion in assets under management in the United States. Henderson, which is based in London, is a large investment manager in Europe with about $91 billion in assets under management in Britain and Continental Europe.

“This is a transformational combination for both organizations,” Dick Weil, the chief executive of Janus, said in a news release. “Janus brings a strong platform in the U.S. and Japanese markets, which is complemented by Henderson’s strength in the U.K. and European markets.”

The transaction is expected to close in the second quarter of next year and is subject to shareholder and regulatory approval.

Henderson shares jumped 14 percent in early trading in London on Monday after the announcement.

Under the terms of the deal, each share in Janus, which has a market capitalization of about $2.61 billion, would be exchanged for 4.7190 new Henderson shares, giving Henderson shareholders about 57 percent of the new company.

The companies also said that as a combined asset manager they would be more stable through market cycles and would have greater geographic reach. They said the merger would also result in annual cost savings of $110 million.

The combined company would be based in London and would have had revenue of more than $2.2 billion in 2015. It will have about 2,300 employees at 29 locations worldwide.

On a pro forma basis, about 54 percent of the company’s assets under management would come from the United States; about 31 percent would come from Europe, the Middle East and Africa; and 15 percent would come from Asia.

Michael Werner, a UBS analyst, said that the merger appeared to be complementary “in many respects,” given Janus’s position in the Americas and Henderson’s scale in Europe. The two companies also had differing asset portfolios, with Janus more heavily invested in American equities and Henderson having more in global and European stocks.

The new company’s board of directors would be composed of the same number of directors from each company, with Richard Gillingwater, the Henderson chairman, serving as chairman of the combined company and Glenn S. Schafer, the Janus chairman, serving as deputy chairman.

Mr. Weil, the Janus chief executive, and Andrew Formica, the Henderson chief executive, would serve as joint chief executives of the combined company.

Janus which is based in Denver, had about $195 billion of assets under management and exchange-traded products as of June 30. Henderson had about 95 billion pounds, or about $123 billion, of assets under management at the end of June.

Together they plan to apply to trade on the New York Stock Exchange but would also keep Henderson’s listing on the Australian Securities Exchange. After the merger, Henderson would drop its listing in London.

Dai-ichi Life, the Japanese insurer that is Janus’s largest shareholder, has agreed to vote in favor of the merger and would hold about 9 percent of the combined company, according to the news release. Dai-ichi Life intends to invest further in the combined company, ultimately increasing its ownership interest to at least 15 percent.

Henderson’s board was advised by Bank of America Merrill Lynch, Centerview Partners and the law firm Freshfields Bruckhaus Deringer. Janus’s directors were advised by Loeb Spencer House Partners and the law firm Skadden, Arps, Slate, Meagher and Flom.

Continue reading the main story

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *

You may also like

S&P 500 Posts Biggest Decline in Three Months on Washington Worries

With valuation levels considered high in many stocks,