Titanium Asset Management has entered into a sale and purchase agreement to acquire 100% of the membership interests in Boyd Watterson Asset Management LLC, an established US-based money management firm, from its parent company, Boyd Watterson Asset Management Holdings LLC. BWAM, founded in 1928, is based in Cleveland, Ohio and as of September 30, 2008 had assets under management of approximately U$3bn. Its client base is largely institutional, but also includes high net worth individuals and (through broker dealer contracts) retail clients. Its managed assets mainly comprise US fixed income securities, and it also manages US and international equities on behalf of its clients.
Completion of the acquisition is expected to occur on or around December 31, 2008. The initial consideration payable (which may vary according to the rate of client retention) is expected to be US$7.5 million in cash. 250,000 shares of Titanium common stock will be issued to BWAM employees at or after completion. Up to a further US$8 million is payable in early 2011 in a combination of cash and stock depending on BWAM’s annualized revenue run-rate as of December 31, 2010.
“We are delighted that BWAM has become another member of the Titanium group of companies. It has skilled investment professionals, an excellent client base and a strong new business pipeline. It is very complementary to the three businesses we already own. Even in difficult market conditions we are pleased that we continue to be able successfully to execute our business strategy of acquiring and integrating asset management companies,” said Nigel Wightman, Chairman and CEO of Titanium, in a press release. “We are very excited to be joining Titanium. We have known many of the senior Titanium executives for a considerable period and believe that we can work with them to further extend the scale and scope of Titanium’s business,” said Brian Gevry, CEO of BWAM, in the release.