Assetco has inked a conditional agreement to acquire SVM Asset Management in a deal worth roughly £10.7m.
The independent fund management business is based in Edinburgh and was founded in 1990 by managing director and chief investment officer Colin McLean and UK investment director Margaret Lawson.
It is home to around £586m ($717m, €682m) in assets under management and runs five open-ended funds: UK Growth, UK Opportunities, Continental Europe, All Europe SRI and World Equity.
SVM also manages a £6.8m investment trust, SVM UK Emerging Fund, which is listed on the London Stock Exchange.
Assetco said the SVM funds complement the existing listed equity fund strategies offered by its various businesses, most notably those from River and Mercantile.
Following completion, Assetco will have approximately £3.5bn of AuM in listed equity fund strategies across its various businesses.
Once the deal is done, McLean will become a director of Assetco’s Scottish business and focus on ensuring a smooth transition for SVM’s business and clients. He will also help set the strategic direction of the company north of the border as part of his new role.
Lawson will continue in her role managing UK equity portfolios, as will global and UK investment director Neil Veitch and European investment manager Hugh Cuthbert.
SVM’s existing 21 employees will remain with the firm.
Assetco chairman Martin Gilbert and deputy chair Peter McKellar will join the board of SVM, alongside Alex Hoctor-Duncan who is chief executive of Assetco’s listed equity platform and of River and Mercantile, which was acquired earlier this year.
Building an Edinburgh hub
Assetco intends to build an asset management hub in Edinburgh, focused on managing listed equities.
Subject to regulatory approval, SVM is to spearhead Assetco’s plans to have a significant asset management hub in Edinburgh, which already includes Saracen Fund Managers and Revera Asset Management.
The three businesses collectively have over £800m of AuM. All will retain their distinct active equity investment philosophies and client profiles, however, the intention is that they will share compliance, operational, distribution and marketing resources with River and Mercantile.
McLean said: “When I set up SVM our aim was to leverage quality research and strong fundamentals to underpin our independent thinking and deliver great investor value. I believe that our performance over the years demonstrates that we have been able to achieve this.
“I am pleased that with the backing of Assetco we will be able to continue to build our focus on, and relationships with, existing clients, creating greater value for them, whilst also broadening our client base and growing assets.”
Gilbert added: “We are immensely proud to be building an asset management hub in Edinburgh that, over time, will broaden its client base across the UK and beyond. SVM is a well-regarded fund management firm, with a recognised investment style and a very strong investment track record. Its business model, people and product offering are its key assets, and it is core to Assetco’s ambitions.
“I have known Colin and Margaret for over 30 years, and I am delighted that both have agreed to remain with SVM. Both have built phenomenal reputations as investment managers over many decades in the industry. The experience and expertise they will bring to Assetco will be invaluable.
“I am also heartened that fund managers of the calibre of Hugh and Neil have committed to the business, as they have important roles to play. We are looking forward to working with the four of them, and the rest of the SVM team, as we develop a business to meet the evolving long-term financial needs of investors.”