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Dealwatch: Linklaters, HSF and Travers Smith win key roles as Man Group acquisition targets Japan

Herbert Smith Freehills (HSF) won its first M&A mandate for Man Group, as the hedge fund acquired the investment management business of Mayfair-based NewSmith, with Linklaters and Travers Smith also picking up key roles.

HSF acted for Man Group, the world’s largest listed hedge fund manager, with a team led by corporate partner Mike Flockhart alongside employment partner Tim Leaver. Flockhart said: ‘We have a very good relationship with Man Group, particularly on the funds side, but this is the first M&A transaction we have done for them. Although we did have a role acting as Credit Suisse’s adviser when Man acquired Numeric in 2014.’

He added: ‘The asset management sector is hot at the moment and there is a lot of consolidation. Some transactions are driven by opportunistic factors, some by strategic ambition. Man is obviously in an acquisitive phase at the moment and has completed a number of acquisitions in the last 12 months.’

A Travers Smith team led by senior partner Chris Hale acted for the founding partners of NewSmith, which has $1.2bn funds under management and invests in UK, European and Japanese equities.

The other stakeholder, Japan’s Sumitomo Mitsui Trust Bank, which owns a 40% share of the UK asset manager was represented by Linklaters with M&A and restructuring partner David Holdsworth leading for the firm alongside corporate associate Peter McCabe. The acquisition is expected to complete in the second quarter of 2015, subject to regulatory and other approvals.

In a statement, Luke Ellis, president of Man Group, said: ‘We believe that NewSmith is a highly complementary business for Man GLG. The acquisition brings a new dimension to the firm, including a Japanese hedge fund and an excellent team in Tokyo, as well as adding further scale to our London business.’

This is one of just a number of asset management deals that HSF has acted on recently with Flockhart having also advised Veritas Asset Management and its founders on Affiliated Managers Group’s acquisition of a majority stake, and Keith McDermott and a related family trust on the sale of their stake in Longview Asset Management to Northill Capital.

HSF also recently worked alongside Travers Smith on the £500m IPO of – Britain’s largest online rail booking company. Travers Smith advised the owner, Exponent Private Equity, while HSF advised Morgan Stanley and JP Morgan.