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Legendary Value Manager Sells to Holding Company

Easterly has purchased John Levin’s $6.1 billion institutional business, calling large-cap value investing a “contrarian story.”

Easterly — a holding company focused on asset managers — has purchased the institutional business of John Levin’s Levin Capital Strategies, the holding company announced Tuesday.

The large-cap value shop has been renamed Levin Easterly Partners. Its investment and management team, numbering more than a dozen professionals, will own 35 percent of the new company. Easterly owns the remaining 65 percent, the announcement said. Levin Easterly manages $6.1 billion in long-only strategies, including as a subadvisor for the $2.14 billion Transamerica Large Cap Value Fund.

Former Levin Capital portfolio manager Jack Murphy became chief investment officer of the new firm. 

[II Deep Dive: Easterly Partners Ups Bet on Money Managers]

Darrell Crate, chairman of Levin Easterly, said Easterly plans to expand Levin, which has had solid long-term performance in a style that has been in a multi-year downturn. Crate said the new owners did not have an explicit AUM target, but that the firm could easily be a $10 billion to $20 billion manager with the right support. The Transamerica fund ranks in the top 13 percent of its category over five years, according to Morningstar. 

“In the most efficient markets in the world, they’ve been able to find value,” Crate said in a Tuesday interview with Institutional Investor. “Today this is a contrarian story. With large cap value, many people say, ‘just buy the index. You can’t add value in large cap.’ But these guys have been delivering excess returns over 20 years. So that’s not true,” added Crate. 

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