South African fund manager snaps up AIB Investment Managers

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  • South African fund manager snaps up AIB Investment Managers

IRELAND - Allied Irish Banks (AIB), the partially state-owned lender, has sold its asset management business to a South African bidder for an undisclosed sum.

In an announcement to the Irish Stock Exchange, AIB said the acquisition of AIB Investment Managers (AIBIM) and AIB Asset Management by Prescient Holdings was expected to close by the first quarter of next year, pending regulatory approval.

It added: "The positive impact on AIB Group's capital position as a result of the transaction is not material."

The sale of AIBIM was agreed under the terms of the Irish government's recapitalisation, with the National Pensions Reserve Fund (NPRF) most recently injecting €3.8bn, with a further €5bn used to buy shares. The state, through the NPRF, currently holds a 99.8% stake in the bank.

A spokesman for AIB Group declined to comment on specifics of the deal with Prescient Holdings, instead referring to a statement published by the Cape Town-based company.

While the statement by Prescient - which opened a Dublin office in 2007 - said AIBIM would "continue to be managed by the existing team", it did not say if any efficiency savings would be asked of it.

Frank O'Riordan, managing director at AIBIM, said the deal was a "very significant step", while Prescient executive chairman Herman Steyn said that, in an effort to build a global business, it viewed Dublin as a "springboard" into European and US markets.

"We have been looking to expand our investment management capability and view this acquisition as a significant part in our development," Steyn added.

As of the end of October, AIBIM, which will be renamed Prescient Investment Managers (Ireland), managed €8.4bn in assets for a number of institutional and private clients. As a result, the ZAR95bn (€9bn) company will effectively double its assets under management.

The deal follows last year's acquisition by State Street Global Advisors of Bank of Ireland Asset Management (BIAM) for nearly €60m.

BIAM's former parent company had also received support from the Irish government, with the NPRF gradually reducing its holdings to 15% and recently selling €1bn in shares to a group of North American investors.

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