Barclays' various sales -- the British bank is selling both its Barclays Global Investors and iShares businesses -- marks a rebound in merger and aquisition activity. Or so says Brian Reilly, Barclays Capital's head of asset management investment banking.
picked up Reilly's remarks to a hedge fund conference last week in Las Vegas.
"We're going to see a massive wave of consolidation across the entire asset management industry, over the next 12 to 24 months," Reilly said during a presentation at the SkyBridge Alternatives Conference.
Reilly rests his thesis on the need for once larger (now smaller) asset managers to add scale to systems that were built for a time when they had more assets under management. Thus, under-utilized computer systems and even idle teams of portfolio analysts will be put to work handling acquired firms money (is that bad news for the acquirees?).
Another driver will be firms seeking to raise capital in a bid to bolster their financial strength. That reason is one for Barclays own sale of its BGI and iShares franchises.
He also sees continued acquisitions by firms seeking to fill strategic holes in their product lines. That motivation has long been a driver of deals and fund adoptions, even in good times.
Reilly did reveal that one Barclay's investment banking client is a "multi-strategy fund" seeking entre into credit markets. A second client is a "European firm" seeking a way into the United States.
Neil Anderson, Managing Editor
Stay ahead of the news ... Sign up for our email alerts now