State Street Global Advisors (SSgA) has agreed to acquire the passive equity business of Gartmore Investment Management, a subsidiary of Nationwide Mutual Insurance Company.
The passive equity business consists of 20 staff, approximately 150 institutional clients and more than £18bn of assets under management from a wide range of UK institutional clients.
The remaining £6bn relates to continuing Gartmore clients to which SSgA will provide passive equity services on a sub-advisory basis. Investors in the index-tracking unit trusts are not affected and will continue to maintain their relationship with Gartmore.
Following the sale of the passive equity business, Gartmore will focus on its chosen strategy of active fund management for institutional and retail clients; this represents about 95% of its current business.
“The acquisition of Gartmore’s passive equity business is a natural and strategic fit for SSgA. It augments our presence in the United Kingdom, building on the success we have enjoyed here in recent years,” said Alan Brown, chairman of SSgA UK. “Gartmore will now focus all of its resources on its chosen strategy of active investment management,” said Gartmore chief executive Glyn Jones.
Under the terms of agreement, SSgA will also hire the Gartmore team that manages, services and administers the passive equity business. The transition will commence immediately.
Gartmore’s passive clients will see few changes since the assets will continue to be managed by the same team under the leadership of Stewart Reed.
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