Boosting its alternative investment platform, Northern Trust Corporation NTRS is set to acquire the investment management business of Aurora Investment Management L.L.C., a unit of the French fund management giant Natixis Global Asset Management.
The deal inked with Northern Trust’s alternatives asset management firm – 50 South Capital Advisors, LLC – is expected to close in the third-quarter 2016. While the financial terms of the deal remained undisclosed, the merger is anticipated to result in almost a twofold increase in 50 South Capital Capital’s total global alternatives platform to about $9 billion. Notably, 50 South Capital had around $3.3 billion in assets under management and about $1.4 billion assets under advisement, as of Dec 31, 2015.
With market presence of over 25 years, Chicago-based Aurora Investment is one of the leading market players in the management of hedge fund portfolios. The firm primarily caters to high net worth investors and institutional clients, including corporate and public pension funds, foundations and endowments and insurance companies.
Northern Trust Chairman and Chief Executive Officer Frederick H. Waddell stated, “We are pleased to take this step and significantly grow our alternative investment capabilities to help investors meet the challenges of high volatility and persistent low yields in financial markets.”
Highlighting the company’s objective, Northern Trust Asset Management President Stephen N. Potter noted, “Alternative investments are a strategic priority for Northern Trust, and we feel this combination strengthens our position in this competitive business.”
Against the backdrop of macroeconomic headwinds, Northern Trust, with renewed vigor, remains focused on initiating new business. The company’s latest deal follows the one to acquire Aviate Global LLP, an institutional-focused equity brokerage firm, announced last December. The acquisition is set to fortify Northern Trust’s global brokerage capabilities and is expected to close in the first quarter of 2016.
Given a healthy balance sheet, the Chicago-based asset management behemoth should be able to undertake further strategic acquisitions. As of Dec 31, 2015, Northern Trust had $6.1 trillion of assets under custody and $875 billion in assets under management.
Northern Trust currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the finance space include Banc of California, Inc. BANC, WSFS Financial Corp. WSFS and GAMCO Investors, Inc. GBL, each sporting a Zacks Rank #1 (Strong Buy).
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