LONDON (ShareCast) - (Sharecast News) - Fund manager Liontrust Asset Management has entered into a conditional sale and purchase agreement with AXA subsidiary Architas, it announced on Wednesday, to purchase the entirety of Architas Multi-Manager (AMML) and Architas Advisory Services (AASL), for a total consideration of up to £75m.
The London-listed firm said the proposed acquisition included the UK multi-manager fund management team at Architas headed by Sheldon Macdonald, which on completion would merge with Liontrust's multi-asset investment team headed by John Husselbee.

It said Macdonald would become deputy head of multi-asset.

The Architas UK fund management team has "vast experience" of, and "a long-term pedigree" in, multi-manager fund management, the Liontrust board said.

On completion, the members of the Architas UK fund management team, as part of the Liontrust multi-asset investment team, would continue to manage a number of risk profiled and non-risk profiled funds, including the seven Architas Multi-Asset Passive Risk Profiled Funds, the five Architas Multi-Asset Blended Risk Profiled Funds, the six Architas Multi-Asset Active Risk Profiled Funds, the four Architas Specialist Funds, and the three Architas Income Generating Funds.

Liontrust said the acquisition would create a "significant" multi-asset multi-manager proposition in the UK by product range, with assets under management and advice standing at £6.6bn.

It said its total assets under management and advice would increase by £5.6bn to £25bn, adding that the Liontrust brand would be used for all the UK Architas funds.

The proposed acquisition, before transaction and reorganisation costs, was expected to be "broadly neutral" in terms of adjusted diluted earnings per share for the financial year ending 31 March 2021, and earnings-enhancing beyond that.

Liontrust said the consideration, transaction and reorganisation costs would be satisfied by the net proceeds of a non-pre-emptive placing of up to 5.09 million new ordinary shares, as well as existing company cash resources.

"The Architas UK investment business is an important strategic acquisition for us to meet the growing demand for investment solutions from advisers and their clients over the next few years," said Liontrust chief executive officer John Ions.

"It builds on and complements our existing investment solutions of multi-asset portfolios, sustainable managed and equity income funds.

"Buying the Architas UK investment business will expand our distribution among financial advisers through the scale of the combined businesses, the strength of the merged investment team, the broad range of multi-asset multi-manager portfolios and funds and enhanced client service."

Ions said financial advisers were "key clients" for Liontrust, due to the responsibility they had as guardians of people's savings.

He said that, by offering both risk-profiled funds and target risk portfolios, the firm would help advisers to meet their suitability requirements by giving them the ability to choose the solution that best met the needs of their clients, in terms of investment and risk.

"Combining the teams led by John Husselbee and Sheldon Macdonald will give us significant capability in multi-asset multi-manager investments.

"The enlarged proposition will also enhance our client service to our existing and new client base. A key attraction of the acquisition is the ability to strengthen the digital tools we can provide to support and service financial advisers and their clients.

"The quality of the investment teams, the broad range of funds and portfolios, Liontrust's sales and marketing capability, and the power of our brand give me great confidence we will grow the multi-asset multi-manager portfolios and funds over the next few years."

At 1528 BST, shares in Liontrust Asset Management were up 6.9% at 1,395p.

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