Paris-based global asset management network iM Global Partner, whose partner firms have around $36 billion in assets, will acquire a 45 percent stake in boutique firm Richard Bernstein Advisors. Separately, Barings, an international investment management firm with around $382 billion in assets under management, loaned $141 million to iM Global to make additional investments. The loan is expected to be used in full by the end of the summer and Barings may provide additional capital after that.
“We are building a strong network with highly-complimentary, high-conviction managers,” said Philippe Couvrecelle, iM Global Partner’s chief executive officer, on the deal. Couvrecelle added RBA appealed to iM because of its robust investment process and team approach. He also said the firm appreciates cautious managers, another criterion RBA met.
In 2019, iM Global said it would invest more than half a billion in asset managers by 2024, and, the firm recently revealed it is on track to reach $150 billion in AUM by 2030.
“This growth plan is backed by strong shareholders,” Couvrecelle told Institutional Investor. “On the funding side, we have a lot of power. On the investment side, we deploy capital, as we did for the past five to six years, by making some new acquisitions.”
iM Global Partner's model is to acquire a minority stake — or in some cases 100 percent — of boutique asset management firms. The firm, which has made investments in managers including Polen Capital, Scharf Investments, and Sirios Capital Management, provides its partners with business development tools, including distribution capabilities. In March, the firm bought 100 percent of asset manager Litman Gregory, acquiring the company’s U.S. distribution platform for mutual funds and exchange-traded funds,II previously reported.
Couvrecelle said conversations with RBA began in 2018, when iM Global was a much smaller and younger company. At the time, iM Global didn’t have any asset allocation firms in its network.
“When you’re a small, successful firm, there’s always [larger] firms snooping around,” Richard Bernstein told II. RBA is an investment manager that focuses on long-only, global equity and asset allocation. The firm, which opened in 2009, uses macroeconomic indicators to make investment decisions.
Despite the acquisition, Bernstein said he’s not worried about the usual woes of a buyout — cost cutting, layoffs, culture clashes — because the firm is a minority owner: “They were the only people we spoke to who truly wanted to develop a symbiotic partnership,” he said.
Bernstein said iM Global will help his firm achieve its goal of diversifying its client base. According to Bernstein, iM Global will help RBA expand its investor base among RIAs and in the European institutional market, as well as develop non-U.S. versions of its products.
“There’s been a lot of demand for some of our products in UCITs form, but we haven’t been able to do it,” Bernstein said. “So that’s three different, additive growth routes they provide us.”