Man Group Declares New Acquisition, Shares Spike

Shares in Man Group got a much needed boost as the company unveiled its latest acquisition, Aalto Invest. The company also posted better than expected trading results and revealed it would be buying back shares of $100 million over the next year. The positive news sent shares up 14 percent to 123.3p. The FTSE 250 listed company will be taking over the U.S. real estate equity manager in a deal to be completed in January. Aalto Invest currently has $1.7 billion in real estate assets. The acquisition will join a new group to be launched by Man Group called Man Global Private Markets. This will provide investors the opportunity to buy-into longer term investments. Man Group also revealed that its assets under management increased by $4.3 billion in the third quarter to reach $80.7 billion.

Man Group is to pay $25 million in cash and shares to Aalto Invest to begin the takeover, though the final figure could go up to $207 million. Man Group’s Chief Executive Officer, Luke Ellis said ‘Aalto will be instrumental in the development of Man Global Private Markets, our new private markets capability. In line with our strategy to continue to diversify the firm and our offering for clients, this private markets capability is complementary to our broad offering in liquid strategies.’ The Group had another surprise for investors, revealing that its hedge fund had a net inflow of $1.3 billion in the third quarter, which is the first time this year it has seen an increase. The Group is not out of the woods yet, as tougher regulations, increased pressure from investors and weak market returns are forcing asset managers to diversify. Analysts are sceptical of Man Group’s ability to continue delivering in the short to medium term in the face of harsher market conditions.