Consistent with its efforts to expand its institutional and retail client base, Affiliated Managers Group Inc. (AMG) closed a deal with Aviva Investors North America Holdings, Inc., thereby acquiring River Road Asset Management from the latter. Aviva Investors North America Holdings, Inc. is a subsidiary of Aviva plc (AV), the U.K.-based insurer.
The terms and conditions of the aforementioned deal, announced in Mar 2014, were not disclosed. Moreover, per the deal, the executives and key investment professionals of River Road will continue to be associated with the unit’s operations.
Headquartered in Louisville, KY, River Road has nearly $11 billion in assets under management (AUM.TO) and offers value-oriented equity strategies. The acquisition seems a strategic fit for Affiliated Managers as it will not only expand its present market share but also enable it to capitalize on River Road’s innovative product portfolio.
Affiliated Managers’ stock price movement, following the news release on Monday, reflected a positive market response. The shares closed at $205.40, inching up 1.46% from the previous-day figure.
Given Affiliated Managers’ strong balance sheet and liquidity position, we expect the company to continue investing in other companies. Earlier in Mar 2014, the company completed its investment in SouthernSun Asset Management, LLC, while in Apr 2014 it completed an equity investment in EIG Global Energy Partners, LLC.
Further, consistently sound performance of its affiliates, product diversification and expansion of global distribution networks will steadily support Affiliated Managers’ top-line growth in the quarters to follow.
Currently, Affiliated Managers carries a Zacks Rank #3 (Hold).
Some better-ranked investment managers include Woori Finance Holdings Co., Ltd. (WF) and Ameriprise Financial, Inc. (AMP). While Woori Finance sports a Zacks Rank #1 (Strong Buy), Ameriprise holds a Zacks Rank #2 (Buy).