Corporate moves continue in the global asset management industry. The Goldman Sachs Group has announced that it has entered into an agreement to acquire the Dutch asset manager NN Investment Partners (NN IP) from NN Group N.V. for approximately 1.6 billion euros (1.87 billion dollars), consisting of a base purchase price of 1,515 million.
This amount doesn’t include a ticking fee and excess capital of 50 million euros to be distributed in the form of a dividend before completion, so the final figure could rise to €1.7 billion. The transaction is expected to close by the end of the first quarter of 2022, subject to regulatory and other approvals and conditions, reveal the statements released by both firms.
As part of the agreement, NN Group and Goldman Sachs Asset Management will enter into a ten-year strategic partnership under which the combined company will continue to provide asset management services to NN Group.
The combination of the complementary investment capabilities of NN IP and Goldman Sachs will create a full suite of asset management products that can be offered to clients through the distribution networks of both parties. At the same time, NN IP has highlighted that its “leading position” in responsible investing will strengthen Goldman Sachs Asset Management’s sustainable investment strategy, product offerings and client solutions.
A stronger European business
NN IP is a leading European asset manager based in The Hague, Netherlands, with approximately $355 billion in assets under supervision and $70 billion in assets under advice. It offers a broad range of equity and fixed income products, with a strong ESG integration across its business. Besides, it is a top-ranked ESG manager in Europe and 75% of its assets under supervision are ESG integrated. With a heritage dating back almost 175 years, NN IP employs more than 900 professionals in 15 countries and combines the use of data and technology with fundamental analysis in its investment processes.
NN IP’s employees will join Goldman Sachs Asset Management following the closing of the transaction and both firms expect that the Netherlands will become a significant location in GSAM’s European business. “We believe that their expertise will strengthen our fund management and distribution platform across retail and institutional channels in Europe and support us in delivering long-term value to clients”, said Goldman Sachs in its press release.
In their view, NN IP is highly complementary to their existing European footprint and will add new capabilities and accelerate growth in products such as European equity and investment grade credit, sustainable and impact equity, and green bonds.
Goldman Sachs has $2.3 trillion in assets under supervision globally, and this transaction will bring assets under supervision in Europe to over $600 billion, aligning with the firm’s strategic objectives to scale its European business and extend its global reach.
As a result of the agreement, Satish Bapat will step down from his role as a member of the Management Board of NN Group. He will continue to lead NN IP in his role as CEO.
A strategic partnership
Meanwhile, the combination with Goldman Sachs gives NN IP a broader platform to accelerate its growth and further improve the offering and service to its clients. It will also allow NN Group to continue its cooperation with NN IP and to benefit from the strengths and complementary product propositions of Goldman Sachs.
As part of the agreement, GSAM will enter into a long-term strategic partnership agreement with NN Group to manage an approximately $190 billion portfolio of assets, reflecting the strength of the business’ global insurance asset management capabilities and alternatives franchise.
The partnership will establish Goldman Sachs as the largest non-affiliated insurance asset manager globally, with over $550 billion in assets under supervision, and the acquisition will provide a foundation for further growth in the firm’s European fiduciary management business, building on the success of its platform in the United States and United Kingdom.
“This acquisition allows us to accelerate our growth strategy and broaden our asset management platform. NN IP offers a leading European client franchise and an extension of our strength in insurance asset management. Across their offerings they have been successful in integrating sustainability which mirrors our own level of ambition to put responsible investing and stewardship at the heart of our business. We look forward to partnering with the team at NN IP as we focus on delivering long-term value to our clients and our shareholders”, commented David Solomon, Chairman and CEO of Goldman Sachs.
Meanwhile, David Knibbe, CEO of NN Group, pointed out that they have a “longstanding and successful” shared history with NN IP. “We value this strong and constructive relationship that we have and we look forward to further building on it in a new form. This transaction brings together two international asset managers, each with many decades of investment experience. We have found a strong and professional partner in Goldman Sachs, providing an environment in which our NN IP colleagues can continue to thrive, while the combined investment expertise and scale will enhance the service offering to their clients, including NN Group”, he added.
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