Asset management roundup: RBC, BlueBay, Timberland Investment Resources
GLOBAL - Royal Bank of Canada (RBC) and BlueBay Asset Management have agreed terms for the recommended acquisition of BlueBay by RBC, valuing the fund manager at approximately £963m (€1.1bn).
With the unanimous backing of Bluebay's board, the acquisition is expected to close by the end of December 2010.
The transaction will be funded using RBC's existing cash resources and is not expected to have a material impact on the company's earnings per share in the near term.
BlueBay is one of Europe's largest independent managers of fixed income debt funds and products, with $40bn in assets under management as at 30 September on behalf of institutional and high net worth investors in the UK, Europe, the US, the Middle East, Asia and Australasia.
Based in London, BlueBay manages a combination of long-only and alternative investment strategies across the sub-asset classes of fixed income credit, primarily focused on European and emerging markets strategies.
These include investment-grade corporate debt, high-yield corporate debt, emerging market debt, convertible bonds, distressed debt and multi-strategy debt capabilities.
BlueBay will retain its investment and operational independence following the acquisition, but 220 BlueBay employees will join RBC's Global Asset Management and wealth management arms.
In other news, Timberland Investment Resources (TIR), an independent forestry investment firm, has established a London base for its European operations.
Co-founder managing partners Hugh Humfrey and Gian Paolo Potsios plan to provide UK and European institutional and high net worth investors with access to large-scale forestry investment opportunities worldwide.
The firm is awaiting authorisation from the Financial Services Authority.
Humfrey is responsible for overseeing TIR-Europe's investment strategy, while Potsios is responsible for directing business development and investor relations.
TIR-USA, based in Atlanta, Georgia, and Boston, Massachusetts, was founded in 2003 and has more than $750m under management.
Tom Johnson, chairman of TIR-Europe, said: "The forestry asset class is gaining prominence globally because of its history of outstanding performance and its demonstrated ability to serve as a portfolio diversifier and inflation hedge."
In IPE's November issue, as part of a special report on inflation and real assets, we talk to Hugh Humfrey and other timberland asset managers about whether forestry represents a viable source of inflation-protected cash flows.