UK fund manager Henderson Group is acquiring its troubled peer New Star Asset Management for a total of £115 mln (EUR 128 mln). Henderson, which will raise £65 mln from a share issue to finance the deal, said it expects to become the 5th largest UK retail fund manager with in excess of £15 bn (EUR 16.4 bn) of funds under management. Buying New Star will also expand Henderson's direct property business into the retail investor market.
UK fund manager Henderson Group is acquiring its troubled peer New Star Asset Management for a total of £115 mln (EUR 128 mln). Henderson, which will raise £65 mln from a share issue to finance the deal, said it expects to become the 5th largest UK retail fund manager with in excess of £15 bn (EUR 16.4 bn) of funds under management. Buying New Star will also expand Henderson's direct property business into the retail investor market.
The deal is conditional on several factors, including approval of New Star shareholders to delist New Star and on the repayment of £20 mln of debt under New Star's existing credit facility that will be outstanding following the restructuring of debt-laden New Star.
Both Henderson and New Star are active in real estate. Property accounts for EUR 8.9 bn of the total of EUR 53.3 bn in assets under management at Henderson. New Star's EUR 989 mln UK Property Unit Trust was launched in June 1999. The EUR 675 mln New Star International Property Fund was launched in June 2007. But New Star was forced to halt redemptions from the fund for an initial 28 days in November 2008 as cash-starved institutions sought to withdraw their investments.
