Global fund managers WestAM and Mellon Financial have announced plans to merge some of their operations into a 50:50 joint venture, in a move that will give Mellon a much sought after domestic equities capability in Australia.
The two groups announced this morning that they had reached an in-principle agreement to set up the jointly-owned funds management business, made up of WestAM’s existing asset management divisions in Germany, the UK, Italy, Spain, the US, Japan and Australia and Mellon’s German funds management operations.
The deal is likely to see WestAM and Mellon join forces to distribute their range of funds in Australia.
Currently, Mellon, a US$4 trillion institution, only offers international asset classes in Australia, but it has previously signalled its intention to develop a domestic equity capability.
WestAM has specialised in Australian equities since it entered the market here in 2000, when it bought out HSBC’s Quant business.
While WestAM will continue to market its products in Australia under its own moniker for the time being, it is understood ongoing negotiations over the joint venture will include discussions over whether the two groups should consolidate their presence here.
