Man Group Plc, one of the world’s largest independent alternative investment managers, has entered into a conditional agreement to acquire Numeric Holdings LLC.
Numeric is a privately-owned, Boston-based quantitative equity manager with US$14.7bn of funds under management as at 31 May 2014.
Founded in 1989, Numeric has an attractive and established investment track record across a range of long only and long-short, fundamentally based quantitative strategies. Based on annualised returns, over 95% of Numeric’s current strategies have historically outperformed their selected benchmark over one, three and five years. 100% of Numeric’s long only strategies covered by eVestment rank in the top quartile of their respective peer groups over one, three and five years.
Numeric’s business has seen substantial growth in recent years, with funds under management increasing from US$7.6bn at the end of 2012 to US$14.7bn as at 31 May 2014. Numeric generated EBITDA of US$47m for the year ended 31 December 2013.
Under the terms of the acquisition, Man will pay US$219m in cash at completion, with up to US$275m of further consideration payable to a broad group of the Numeric management team and employees following the fifth anniversary of completion under an option arrangement, dependent on the run rate profitability of the business. The regulatory capital usage associated with the Acquisition is expected to be approximately US$325m.