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SMFG to acquire TT International
Posted on Friday, 23 August 2019 13:09
Japan’s Sumitomo Mitsui Financial Group (SMFG) has agreed to acquire UK-based asset manager TT International and all of its businesses in the buyer’s first ever overseas acquisition in this sector.

Terms of the deal were not disclosed by the businesses; however, a person close to the situation told Reuters and Nikkei Asian Review the consideration is around JPY 20.00 billion (USD 187.87 million).

According to the latter report, the price could increase to JPY 35.00 billion after performance-based compensation is added.

SMFG plans to complete the acquisition by March 2020 after receiving the green light from the relevant authorities.

By adding TT International and all of its assets to its portfolio, the purchaser will expand its overseas asset management business.

The target, founded in 1988, has USD 8.40 billion in total managed assets at the end of July 2019, as well as strengths China and emerging markets, while covering a range of pension investors in Europe, North America and Asia Pacific.

SMFG said it has designated the asset management business as a strategic focus for its current medium-term management plan and is undertaking efforts to boost the segment.

Reuters observed that Japanese lenders are looking to expand in asset-based fees to generate a reliable revenue source, as part of Bank of Japan’s policy that has kept low rates for years.

According to Zephyr, the M&A database published by Bureau van Dijk, there have been 39 outbound deals involving Japan-based companies investing in the overseas finance and insurance sector announced in 2019 to date.

Interestingly, the largest of these involved Sumitomo Mitsui Banking picking up an additional 57.0 per cent stake in Bank Tabungan Pensiunan Nasional of Indonesia for IDR 14,277 billion (USD 1.00 billion).

Reliance Nippon Life Asset Management of India, Brazil-based Banco Inter and US-headquartered Lemonade, among others, have all been targeted by Japanese companies in 2019 to date.

© Zephus Ltd