A SCOT BAGS A BARGAIN

So believers in Scottish, accounting and mathematics stereotypes were not surprised when Douglas Ferrans, CEO of London-based Insight Investment Management, snared Rothschild Asset Management last month for less than half the going rate for investment firms.

Headlines blared a £61 million ($94.5 million) price, but once you cut out the substantial cash on RAM's balance sheet, Ferrans paid only about £40 million, the equivalent of just 0.4 percent of RAM's £10 billion in assets. That is a far cry from portfolio manager price tags during the bull market, when firms fetched between 2 percent and 4 percent -- or more -- of assets.

"It probably is one of the cheapest deals done in the sector," grants Ferrans, 48. "But, then, there is a complete absence of buyers." RAM also has some shortcomings: It is losing money and despite a big investment in retail, never established a significant presence.

Ferrans coveted Rothschild's £8 billion institutional fixed-income business. He expects it to grow rapidly as pension funds, disillusioned with falling or listless stock markets, switch out of equities. He also intends to grow RAM's £900 million retail fund-of-funds business and develop an institutional manager-of-managers equivalent.

Insight Investment is the money management arm of HBOS Group, formed from last year's merger of Halifax and Bank of Scotland. "We are a new business and are looking to grow," says Ferrans, who notes dourly that "many other money managers are shell-shocked and running to cover."