Pendal Group to double assets with Thompson, Siegel & Walmsley acquisition
Pendal Group Limited (Pendal), parent company of J O Hambro Capital Management Limited (JOHCM), is to acquire 100 per cent of Thompson, Siegel & Walmsley LLC (TSW), a Virginia-based value investment manager, for USD320 million.
Established in 1969 and headquartered in Richmond, Virginia, TSW operates primarily in long-only equity (US and International), with USD23.6 billion of assets under management. The deal will more than double assets under management by Pendal's US business, which will increase from USD21.1 billion to USD44.7 billion.
Pendal Group CEO, Nick Good, says: "This is a compelling opportunity to acquire a highly successful complementary business, which will create immediate value and facilitate our growth opportunities in the US market. This acquisition significantly broadens the range of product solutions we can offer clients via an expanded distribution network.
"TSW is a natural strategic and cultural fit with JOHCM and the broader Pendal business, particularly given our shared core belief in investment team autonomy. Both businesses have solid flow momentum and strong performing, high conviction investment strategies. TSW is also highly complementary to our business, with almost no overlap of investment strategies or clients."
TSW is a highly regarded value-oriented investment manager, with a solid base of institutional and sub-advisory relationships and a track record of strong investment performance: four of the six funds where TSW is the sole sub-advisor are rated either four or five stars by Morningstar and are ranked first quartile in their peer group over three years. Its investment capability spans international value equities, US equities and fixed income.
TSW has an experienced and stable staff of 74 employees including a long-tenured and talented investment team of 20, with deep bench strength across all strategies. The TSW team is fully supportive of the acquisition and aligned with Pendal's values, its ethos of investment autonomy and its growth aspirations. All TSW employees will join the Pendal Group and there are no staff reductions planned. TSW's investment strategies will remain under the TSW brand.
Good comments: "Cultural fit is crucial in fund management acquisitions, and both parties have put significant effort into considering compatibility, investment and client approach and alignment."
TSW's CEO, John Reifsnider, will be appointed as CEO of Pendal's combined US business upon close, taking over leadership of JOHCM USA from Good, who was promoted in March to Pendal Group CEO, in addition to his current role as CEO of TSW. Reifsnider will also join Pendal's Global Executive Committee.
Good says: "John is an outstanding leader and the right person to head the combined US business. He will continue to drive the positive momentum that is evident in both companies and seize the new growth opportunities we see ahead of us."
Reifsnider says: "This is a unique opportunity for TSW to join a strategically compatible and highly regarded global investment management company. Pendal is a remarkable fit and has strong alignment to our investment approach and culture.
"All of us at TSW are pleased to be joining Pendal Group. We see excellent potential for growth and an exciting future.
"I am proud to take on the role of CEO of the combined US businesses. JOHCM has been very successful in the US, with 10 consecutive years of positive flows and an enviable reputation in the market. Investment autonomy is fundamental to both our businesses and to our success, and that match has been a very important consideration for the TSW team."
Good says:, "Pendal's acquisition of JOHCM in 2011 was a tremendous success. We are approaching this acquisition of TSW with the same intent and focus and are confident that we will be able to implement a seamless transition."
A multi-jurisdictional team from Allen & Overy advised Pendal Group on this deal.