In a new report, research company Cerulli
warns asset managers that mergers and acquisitions are not always the best way to increase scale and capital.
To avoid challenges like incompatible cultures and
marketing systems, clash of management styles, and negative perceptions of
the merger by the marketplace, Cerulli points managers to other methods like special financing and private equity.
Cerulli is pushing investment managers to maintain full control of their companies, rather than give up any control through M&A. For example, to increase distribution, Cerulli recommends third-party marketers which can move sales into new channels at a low cost.
“M&A is not the right fit for every manager. Firms should assess their
options for what they are tying to achieve and the potential pitfalls of a
merger before they make a move,” Cerulli's team cautioned in the report.
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