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Artemis strikes deal with AMG

AMG, Artemis management to buy firm back from Fortis.

Christopher J. Traulsen, CFA 1 February, 2010 | 11:54AM
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Artemis announced today that it has finally resolved its nagging ownership issue—Artemis management and Affiliated Managers Group (AMG) are to buy the firm outright from current owner BNP Paribas subsidiary Fortis, with AMG taking a majority stake.

We view the transaction as very good news for investors in Artemis funds. Fortis had long planned to sell its interest, creating an overhang of uncertainty. The deal with AMG resolves the issue and should help retain key players by ensuring they have ownership in the firm.

While there is always concern when an outside firm takes a majority interest in a good manager, we view AMG as a very good partner. We have tracked their involvement with many different firms over the years, and view them as benevolent owners—they provide needed capital, but they’re smart enough not to interfere in the investment management operations and to allow the firms they buy to continue to operate relatively autonomously. Other firms owned by AMG include Third Avenue, Tweedy Browne, and Brandywine. All of these houses are known for having strong styles and being unafraid to take stands against conventional wisdom—something that isn’t possible if a corporate parent becomes too concerned about maintaining quarterly earnings.

The deal is expected close at the beginning of the second quarter in 2010. The new firm will be a limited liability partnership, with AMG as majority owner and Artemis management having “substantial equity ownership and continuing to direct the day-to-day operations of the firm.”

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About Author

Christopher J. Traulsen, CFA  is director of fund research, Europe and Asia, Morningstar.