Man Group steps up US presence after deal

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HEDGE fund firm Man Group has bought US peer Numeric Holdings for an initial $219m to broaden its computer-driven business and increase its presence in the United States.

Privately-owned Numeric –which has $14.7bn (£8.6361bn) of assets under management, mostly owned by institutional investors – was put up for sale last year by private equity firm TA Associates, and Man confirmed last month it was in talks to buy the company.

The acquisition comes days after Man said it was buying another US-based firm, Pine Grove Asset Management, which has about $1bn in assets.

Man chief executive Manny Roman said the Numeric deal meant his company could further two of its main objectives – diversifying its so-called quantitative fund business and expanding its presence in the United States, the world’s biggest hedge fund market.

Quantitative trading strategies use computer-based algorithms to determine when to buy and sell an asset.

Numeric’s managers will keep an 18.3 per cent stake in the business, but Man Group will have the right to buy them out five years after completion of the deal under an arrangement capped at a further $275m.

Based on the forecast profitability of the group, Man is expecting the total cost of the deal to reach about $325m.