AMG Tests the Waters in China
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Monday, November 09, 2009

AMG Tests the Waters in China

Affiliated Managers Group just made its first foray into the Chinese market by acquiring a five percent stake in Hong Kong-based Value Partners Ltd., the Wall Street Journal reported on Monday. With a price tag of approximately $36 million, the stake was purchased from a group of Value Partners senior executives for 3.45 Hong Kong dollars (45 U.S. Cents) a share.

Value Partners is an independent money manager with roughly $4.6 billion assets under management. The deal values Value Partners at about $720 million in total, or nearly 15.7 percent of AUM. As part of the deal, the companies plan to develop products together and to share distribution relationships.

Boston-based AMG is no stranger to acquisitions and already holds stakes in several other money-management firms, including Third Avenue Management and AQR Capital Management (both of which have mutual fund offerings). As of September 30th, AMG had roughly $200 billion in assets under management, of which about 40% of its earnings were derived from global and emerging-markets products.

Yet the company's thirst for increasing its global footprint remains unquenched, prompting AMG to pursue opportunities that will increase its presence among international investors and broaden its non-U.S. equity product holdings.

“The opportunity, over time, especially in mainland China, is enormously attractive,” Sean Healey, chief executive of AMG, told the WSJ.

AMG also unveiled plans to cut the ribbon on a new distribution office in Hong Kong, suggesting that the company's expansion into China is merely in its infancy stage.

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