Yarra Capital has announced that it will acquire Nikko AM’s Australian business in a move that will make it one of the country’s largest independent funds managers.
Yarra will assume control of Nikko’s Australian subsidy and its associated entities, while its funds under management will swell to more than $20 billion. It has also begun the search for a new managing director for the combined businesses, with an appointment to be confirmed “in the coming months”.
“Yarra was attracted to the quality of the people within Nikko AM’s Australian business and we are delighted to welcome them into the Yarra team,” said Yarra managing director Dion Hershan, who will leave the role to become executive chair of the group.
“We are also extremely pleased to bring Nikko AM on board as a strategic investor alongside TA Associates. This partnership will help us expand the global reach of our investment strategies, in particular in Japan where we have achieved significant growth in recent years.”
Nikko’s Australian equities business will be folded into Yarra under the revived Tyndall brand and will be led by Brad Potter, Nikko’s current head of Australian equities. It will remain separate to Yarra’s “style neutral” Australian equities business with no crossover in activity and “no change to its value investment philosophy, process or team”.
The fixed-income business will be combined with Yarra’s own fixed-income operations and be jointly led by Yarra and Nikko Australian fixed-income heads Roy Keenan and Darren Langer. Nikko will become a 20 per cent shareholder in the group and appoint one director to its board, while Yarra non-executive director Michael Gordon will chair Tyndall.
“This partnership takes our commitment in Australia to the next stage. We are confident that our investment in Yarra will be the catalyst to enhance the capabilities that Australian investors are looking for, while sales, distribution and back and middle office functions will complement each other and thus continue to provide quality service to our clients,” said Nikko AM president and co-chief executive Hideo Abe.
“We are also excited to be able to expand our Australian equity and fixed income product offering to Japanese and global investors in this new capacity.”