J & W Seligman & Co. Sold for $440 Million
J & W Seligman & Co is independent no more, they have sold themselves to Ameriprise Financial in a deal that values the firm at roughly 2.5% of assets under management:
Ameriprise Financial, Inc. (NYSE: AMP) today announced a definitive agreement to acquire the venerable asset management firm J. & W. Seligman & Co. Incorporated for a total consideration of $440 million. The transaction, which is likely to close in the fourth quarter of 2008, is expected to be accretive to Ameriprise Financial earnings and return on equity in 2009.
New York-based Seligman manages approximately $18 billion in assets in open- and closed-end funds, hedge funds and institutional accounts. Founded in 1864, Seligman is a privately-held company that manages the nation’s first growth mutual fund and helped pioneer single-state municipal funds. Seligman is recognized in particular for its accomplished technology investment team, which manages several retail and alternative portfolios, including Seligman Communications and Information Fund.
The acquisition provides multiple benefits for Ameriprise Financial:
* The addition of Seligman’s approximately $3 billion in hedge fund assets substantially increases the company’s alternative investment activities;
* Seligman’s proven investment management capabilities add breadth and depth to the RiverSource multi-investment boutique strategy. The transaction adds Seligman’s world-class technology investment team, led by Paul Wick, and its accomplished growth team, while its value team complements strong RiverSource value offerings;
* The transaction accelerates the company’s third-party distribution reach and scale, and substantially increases its existing wholesaling force. Home Page
The timing of the sale is a bit curious; they have had years to do this, and waited until valuations of asset management shops absolutely tanked. A well-timed deal, say two years ago, could have brought in another $100 million or so, but it is a lot of money to pay for Paul Wick, who runs roughly 20% of the shops assets. Of course, they never had a viable small or mid-cap strategy worth a damn either, which is a big hole in the shops lineup.
Wick has pulled a lot of money out of that shop, and I am sure he will be busting his ass waiting for the earn out, assuming there is one, to expire.
We should know soon if the deal was consummated on the day the financial stocks bottomed in the great bear market of 2008.
But given it is an accretive deal for Ameriprise, I am sure they are happy to do it right here, and now.
Ameriprise Financial To Acquire J. & W. Seligman & Co.
Homepage
----------------------------------------------------------------------------------------------------------------------
The content contained in this blog represents the opinions of underthecounter. This commentary in no way constitutes a solicitation of business or investment advice. It is intended solely for the entertainment of the reader, and the author.
Blackrock Beatdown Getting Late in the Game?
Is John Thain a big fat liar? No, of course not, but running a financial services firm in this environment is certainly challenging, and unless you have a crystal ball, you might have to eat your words:
The nation's biggest brokerage reportedly is close to selling its stake in Bloomberg L.P. and BlackRock Inc. (BLK-NYSE) amid a cash crunch. Merrill is expected to report a $6 billion write-down, exceeding analysts' expectations, when it reports second-quarter earnings next week.
Though Merrill could raise up to $17 billion from the sale of those stakes, it's likely only to sell a fraction of that in order to value its existing stakes. Merrill carries Bloomberg at zero. If it sells part of it, it can hold the rest on its books at a value set by the sale price..... Now, current CEO John Thain is backtracking in both strategy and words. In January he told analysts "It [BlackRock] remains a strategic asset from my perspective. It is not something we would look to sell."
That he's doing so now represents a firm desperate, but also betting it can make it back in the long run, kind of like someone borrowing against their future. MarketWatch
The Street has been shooting against Blackrock for weeks now, but the selling has really picked up speed over the past few days. But pressing the trade to the shortside might be getting a little dangerous. After all, who does not know this story by now?
Payday for Parr? UBS Hires Lazard
The stock of Lazard Ltd (LAZ-NYSE) has come through the bear market in much better shape than its peers; its M&A franchise and asset management segments are a good place to hide in the current environment.
Their franchise player, outside of Bruce Wasserstein, is the banker’s banker Gary Parr, and it appears he is busy:
UBS has hired Lazard to conduct a strategic review of the Swiss-based financial firm’s businesses, The Post has learned.
The embattled bank has been one of the institutions at the center of the credit crunch, and Lazard’s hiring has fueled speculation that the firm might be considering separating its highly regarded wealth-management division from its much-maligned investment-banking operation New York Post
Of course, before UBS employees begin to freak out, it should be noted this might be business as usual:
One person familiar with the matter noted that UBS’s strategic review might be part of an annual internal review of its business lines, something UBS has stepped up in the wake of losses.
But Parr’s rainmaking skills are part of the reason Lazard’s stock has held up so well in 2008; and absence of sub-prime slime on the balance sheet helps as well.
_________________________________________________________
Lazard YTD: Sideways is a win in this tape
____________________________________________________________
UBS HIRES LAZARD FOR REVIEW
New York Post
-------------------------------------------------------------------------------------------------------------
The content contained represent the opinions of 1440 Wall Street. This commentary in no way constitutes a solicitation of business or investment advice. It is intended solely for the entertainment of the reader, and the author. No Position
Cost Plus Gets a Bid
Originally Published June 10, 2008 11:25 AM
____________________
The difficulty in making money long in retail stocks has not been lost on Cost Plus (CPWM-NASDAQ) shareholders. Many value shops picked away building positions over the past year, but it was apparent that nothing good, short of a buyout, was in the cards. I have a funny story about this stock, but lets just say that putting booze in the back of a retail location is not exactly building a better mousetrap.
Home furnishings retailer Pier 1 Imports Inc. has offered to buy rival Cost Plus Inc. in a stock swap worth about $88 million.
Under its proposal, Fort Worth, Texas-based Pier 1 (NYSE: PIR) would issue 0.6 shares of its common stock in exchange for each share of Cost Plus stock. Based on the stocks’ closing prices on June 6, the deal would be worth about $4 per share, a premium of 31 percent from June 6, or 34 percent over the last 30 trading days.
Pier 1 said it expects a deal could be completed in the third quarter.
“Given our similar customer bases and broadly similar business models, but distinct market positions, we believe Cost Plus is an excellent fit with Pier 1 Imports,” said Pier 1 President CEO Alex Smith in a statement. “We are confident that combining our two companies would create a stronger and more competitive company that is better positioned for future growth.” St. Louis Business Journal
It hard to see anything better coming along. Take the offer, Cost Plus.
Pier 1 offers to buy rival Cost Plus for $88M
St. Louis Business Journal
____________________________
