Acquisition
November 25 2003 - 2:02AM
UK Regulatory
RNS Number:4494S
Man Group plc
25 November 2003
25 November 2003
Acquisition of minority interest in BlueCrest
Man Group plc, a leading global provider of alternative investment products and
solutions and futures broker, today announces that it has entered into an
agreement to acquire 25 per cent. of BlueCrest Capital Management ("BlueCrest")
from its principals for #105 million in cash and shares*. The consideration will
comprise 4,959,210 new Ordinary Shares and cash of #33.3 million to be funded
from existing resources. BlueCrest is an alternative asset manager focused on
fixed income and currencies based in London with funds under management of
US$3.1 billion. It has around 50 staff and is owned by the management. The core
fund, BlueCrest Capital International Limited, is a fixed income arbitrage fund
with US$2.4 billion under management and a compound annual return of around 16%
since inception.
The acquisition of this interest in BlueCrest is part of Man's strategy to
continue to access high quality managers with a material amount of additional
capacity and as part of this transaction, Man will receive preferential access
to available capacity from BlueCrest. BlueCrest has a strong brand name and an
established track record and Man has been an investor in its core fund since
inception, through RMF. The acquisition is expected to be earnings enhancing,
before the amortisation of goodwill, in the first full financial year, to 31
March 2005. In the 12 months to 30 November 2003, the estimated share of profits
to which Man would have been entitled for its 25% stake is #7.6 million before
tax, of which #5.7 million is net management fee income. Given the rapid growth
in BlueCrest's asset base and the current run-rate of earnings, management fees
for the coming year are expected to be considerably higher.
Commenting on the acquisition, Stanley Fink, Chief Executive of Man Group plc
said:
"BlueCrest will help us to accelerate our growth of asset management capacity
whilst diversifying our product range. It is exciting to find a manager like
BlueCrest which has critical mass as well as the potential to grow much further
and this investment represents a significant opportunity for the two
organisations to work together."
Mike Platt, founder of BlueCrest commented:
"The BlueCrest team is delighted to be linking up with the Man Group. This
transaction demonstrates our commitment to building a first class alternative
asset management group and we look forward to working closely together."
Merrill Lynch acted as financial adviser to Man, and Goldman Sachs International
to BlueCrest, in connection with this transaction.
*The acquisition price for BlueCrest of #105 million is based on Man's closing
share price on 24 November 2003.
Enquiries
Man Group plc 020 7144 1000
Peter Clarke
David Browne
Merlin Financial 020 7606 1244
Paul Downes
Paul Lockstone
Vanessa Maydon
Notes to Editors
Terms of the Acquisition
Man has agreed to acquire a 25% interest in BlueCrest Capital Management
Limited, BlueCrest Capital Management L.P., BlueCrest North America L.P., and
BlueCrest North America II L.P., conditional inter alia upon Admission, for
consideration of 4,959,210 new Ordinary Shares and cash of #33.3 million to be
funded from existing resources. Completion of the transaction is subject to
regulatory consents. At completion, the Vendors will enter into lock-up
agreements whereby 50% of the shares received cannot be sold for one year from
completion except with the consent of Man and/or Man's brokers. In addition, Man
has granted to BlueCrest a put option over a further 5% interest in BlueCrest
using a net management fee income formula capped at a maximum price of #30
million at any time during the three year period commencing two years after
completion.
About BlueCrest
BlueCrest is an alternative asset manager focused on fixed income and currencies
and makes wide use of the derivatives markets in order to implement its
investment views. It is based in London with funds under management currently of
$3.1 billion, making it one of Europe's largest alternative asset investment
managers. Since its foundation in 2000, BlueCrest has been building an
impressive track record, having won the Eurohedge Fund of the Year Award in 2001
in its class and a nomination for the same award in 2002. The core fund,
BlueCrest Capital International Limited has funds under management of US$2.4
billion. It was launched in December 2000 and Man have been an investor since
inception through RMF. The fund has a compound annual return of around 16% since
inception. BlueCrest Strategic Limited targets higher risk and lower Sharpe
ratio trades. It was launched at the beginning of July 2003 and has US$0.5
billion funds under management. The Blue Mountain Credit Alternatives Fund was
launched on 1 November 2003 and will invest in structured credit as well as
adopt credit arbitrage strategies. It has funds under management of US$0.3
billion and is managed out of a newly set-up New York office.
About Man Investments
Man Investments, the Asset Management division, is a global leader in the fast
growing alternative investments industry. It provides innovative products and
tailor-made solutions to private and institutional investors. Through its core
investment managers - AHL, RMF, Glenwood and Man Global Strategies - Man has
succeeded in developing leadership in hedge funds and has interests in other
asset classes. In its core hedge fund asset class, Man offers funds of hedge
funds, structured, style and single manager products. Its track record stretches
back two decades and defines the standard for excellence in an industry whose
central goal is to provide diversification away from traditional equity and bond
investments. Man has a powerful global presence and an extensive network of
distribution partners. Further information on Man Investments can be found on
www.maninvestments.com.
About Man Group plc
Man Group plc is a leading global provider of alternative investment products
and solutions as well as one of the world's largest futures brokers. The Group
employs over 2,500 people in 15 countries, with key centres in London, Pfaffikon
(Switzerland), Chicago, New York, Paris, Singapore and Sydney. Man Group plc is
listed on the London Stock Exchange (EMG.L) and is a constituent of the FTSE 100
index. Further information on the Man Group can be found at www.mangroupplc.com.
This information is provided by RNS
The company news service from the London Stock Exchange
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