US asset manager Invesco has reached an agreement to purchase Guggenheim Investments’ exchange-traded funds (ETF) business, whose assets under management amounted to $36.7bn (€31.1bn) as at end of August 2017.
The deal, that will cost $1.2bn (€1bn) through cash and debt to Invesco aims to boost Invesco’s active, passive and alternative capabilities.
The transaction will further enable Invesco to strengthen the competitiveness of its US wealth management intermediaries business and to expand its ETF offering dedicated to the institutional market.
Invesco will need third-party approvals, including certain regulatory matters and requisite ETF board and ETF shareholder approvals, to complete the transaction.
The manager’s ETF assets under management would total over $196bn (€166.1bn) with the acquisition of Guggenheim Investments’ ETF business.
“We’ve built and managed Invesco over many years with a single focus: to help clients achieve their investment objectives,” said Martin Flanagan, president and CEO of Invesco.
“Guggenheim Investments’ ETF business is highly complementary to Invesco’s, and will enable us to provide one of the industry’s most comprehensive and innovative ranges of smart beta ETFs, including fixed income, equal-weight and self-indexed product offerings. The acquisition further expands our ability to build better, more diversified portfolios through our solutions capability, and enhances the range of capabilities available via Jemstep, our advisor-focused digital solution. The addition enhances our ability to help meet client needs, which will help further accelerate the growth of our business.”
Jerry Miller, president of Guggenheim Investments, commented: “With today’s announcement, Guggenheim Investments takes an important step in its growth strategy by sharpening its focus on core strengths, including active portfolio management, across both our institutional strategies and other retail businesses. We are confident that Guggenheim ETF shareholders will find in Invesco the right partner and platform for our suite of distinctive and innovative ETF products, including one of the industry’s leading equal-weight ETF offerings.”