UBS, the biggest Swiss bank, will buy 51 percent stake in South Korea’s largest asset managers, Daehan Investment Trust Management Company (DIMCO) for $162.2m from Hana Financial group.
Under the joint venture, Dimco will lead in the market as UBS Hana Asset Management internationally. The transaction is still subject to regulatory approval. Dimco owned $20.3 billion business and has a huge potential to grab the market.
Expected deal announced after Goldman Sachs management’s agreement to wholly acquire the $11 billion local fund venture Macquarie IMM Asset controlled by Macquarie Bank. Seoul has also given approval to JPMorgan Chase to set up an asset management firm in the country.
After announcing the deal head of UBS Global Asset Management, John Fraser said
UBS Hana Asset Management will be one of the largest asset managers in the Korean market which represents an important source of new business for UBS. In light of Korea’s strong underlying economic growth, continuing reform of the pensions market and the increasing sophistication of investors, we believe that the Korean asset management market offers very significant potential for growth and will be an increasingly attractive destination for foreign investment
The establishment of the joint venture between two moguls seems an ambitious leap to build a strong presence in Korea’s asset management industry and broaden UBS scope for foray into Asia Pacific. UBS is confident to utilize its specialized knowledge and global perspective, with local expert DIMCO.
Korean market has shown the upsurge as its foreign asset managers control about 18 per cent of the market. South Koreans had a total of $260 billion invested in funds, which are 18 per cent up from the end of 2005. South Korea’s financial watchdog, the Financial Supervisory Service, forecasts that the market will grow at a double-digit rate, as the country launches a compulsory retirement savings plan in 2010.
Image: bigfoto
Via: investmentexecutive
