Man Group Shares Surge on Strong Fund Inflows, Buyback
October 14 2016 - 6:00AM
Dow Jones News
LONDON—Shares in Man Group PLC, one of the world's biggest
hedge-fund firms, soared Friday on news of stronger-than-expected
investor inflows and plans for a share buyback.
Man Group, which has been trying to revive its fortunes in
recent years after large outflows in the wake of the credit crisis,
posted $1.3 billion of net inflows for the three months to
end-September. That was well ahead of analyst forecasts of around
$500 million, with growth driven by appetite for the firm's
computer-driven funds.
The firm also said it would buy back up to $100 million of
shares over the next 12 months.
Man Group's shares, which were down 38% this year before today's
announcement, jumped 13% in early London trading.
"The assets-under-management update is reassuring, and the
buyback welcome," said analysts at Bank of America Merrill Lynch,
who rate the shares a buy.
The London-based firm, whose assets rose 6% during the quarter
to $80.7 billion, is widely viewed as a bellwether for an industry
that is struggling to convince investors that its often lackluster
returns are worth the high fees charged.
In July, Man Group posted a slump in performance fees following
a torrid six months for many of its funds, dragging down overall
profit 65%.
Man Group, which has made a string of acquisitions in recent
years to diversify away from its flagship computer-driven fund,
also said it was buying Aalto Invest Holding AG. The U.S. and
Europe-based real-estate fund manager runs $1.7 billion in assets
and will help drive Man's expansion into private assets.
Man will pay $25 million in the deal, two-thirds of which will
be in cash and the remainder in new shares, plus up to $207
million, depending on income from management fees.
--Razak Musah Baba contributed to this article.
(END) Dow Jones Newswires
October 14, 2016 05:45 ET (09:45 GMT)
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