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Rating:Four Firms Vie for DeAM Not Rated 2.0 Email Routing List Email & Route  Print Print
Thursday, December 01, 2011

Four Firms Vie for DeAM

News summary by MFWire's editors

Columbia Management [profile] parent Ameriprise, Invesco [profile], MainStay [profile] parent New York Life, and Principal [profile] all may be bidding for DWS [profile] or other pieces of Deustche Bank's global asset management business. Bloomberg names all four as possible bidders in its latest update on the divestment examination by the giant German bank. Last week Deutsche officially began a review of "strategic options" for its asset management business [see MFWire.com, 11/22/2011].

The wire service received no comment on the story from any of the named possible bidders. A Deutsche Bank spokesman declined to comment on the subject.

Another pub already pointed to Aberdeen, BlackRock, BNY Mellon, JPMorgan and State Street as firms who might be interested, too [see MFWire.com, 11/28/2011]. And last week a third pub put the price of the unit at almost $6.1 billion [see MFWire.com, 11/23/2011].

Fundsters may not be surprised by the new list, as most of them have been acquisition hungry in recent years.

Ameriprise's latest buys include three mutual fund firms: Columbia, Grail Advisors, and Seligman.

Invesco recently took over Morgan Stanley's retail asset management business, including Van Kampen. Principal has built a stable of boutique asset managers, including recent additions like Washington Mutual's asset allocation offerings as well as a stable value shop, Morley.

And at New York Life Investment Management's helm stands John Kim, a dealmaker from the retirement plan industry who led Cigna retirement through an acquisition by Prudential and came out on top of the larger unit at Pru.

Sources told the wire service that Deutsche Bank could bring in between $2 billion and $4 billion from the divestment. Such a sale could involve worldwide assets under management of about $540 billion, not including the European and Asian pieces of DWS, which Deutsche is keeping off the table. And, according to Bloomberg, Deutsche could even sell the business off in pieces, though its management prefers to sell it whole (minus the chunks they're keeping, of course).

"Deutsche Bank has been looking at the business for a long time and decided it's not working," Dirk Becker, an analyst at Kepler Capital Markets, told the wire service. "This is an attractive business for someone specialized in asset management who has sufficient economies of scale."

Frank Braden, an equity analyst at Standard & Poor's, described the divestment as going "in lockstep with solidifying the capital base without having to issue new shares." 

Edited by: Neil Anderson, Managing Editor


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