The Bank of Ireland Group plans to gain a majority stake in Guggenheim Alternative Asset Management – a US Fund of Hedge Funds Manager.
With the acquisition the group will then control 71.5% of Guggenheim Alternative Asset Management, a US fund of hedge funds manager focusing on institutional and high net worth clients, for an estimated cash consideration of $184 million (EUR153 million).
Guggenheim Alternative Asset Management has about $2.8 billion assets under management and is part of Guggenheim Partners, a leading private wealth and investment management firm. The exact cash consideration will be determined based on Guggenheim Alternative Asset Management’s business performance to April 1, 2006.
Guggenheim Alternative Asset Management’s management retains 11% and Guggenheim Partners 17.5% and these holdings are subject to put and call arrangements in the medium term on a pre-agreed basis. In the event of the exercise of these options, the consideration would be in the form of Bank of Ireland stock, of which the number of units has not been decided.
The transaction is expected to close at the end of January 2006, subject to regulatory approvals and other customary conditions.
“This deal enables Guggenheim Alternative Asset Management to harness Bank of Ireland’s international distribution capability which will accelerate its growth in the institutional market,” said Dominic Curcio, managing partner, Guggenheim Partners. “All three parties have a significant interest in the future of the business and we will work together to ensure that Guggenheim Alternative Asset Management becomes one of the leading providers of customised hedge fund solutions for institutional and high net worth investors globally.”