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Rating:BofA Narrows the Columbia Bids to Three Not Rated 4.0 Email Routing List Email & Route  Print Print
Thursday, June 18, 2009

BofA Narrows the Columbia Bids to Three

Reported by Neil Anderson, Managing Editor

The sale of Columbia Management may be nearing its end. MFWire has learned that only three bidders remain in the running for the Bank of America subsidiary: Ameriprise, Invesco and Nuveen.

One source familiar with the situation also told MFWire that a private-equity-backed, management-led LBO of Columbia is also a possibility.

Spokespeople for Ameriprise and BofA could not immediately be reached for comment. Invesco spokesman Doug Kidd declined to comment for this story, citing company policy, and a spokeswoman for Nuveen also declined to comment.

Rumors about Columbia's fate have floated through the industry ever since BofA's acquisition of Merrill Lynch (and, by extension, part of BlackRock) came to light last year. Previously cited bidders include BlackRock itself, as well as Federated Investors, Franklin Resources and John Hancock (see MFWire, 4/1/2009 and 5/11/2009). Yet an industry insider told MFWire earlier this year that Hancock's offer had been rebuffed, and BlackRock will have its hands full absorbing Barclays Global Investors.

"We are not doing any more transactions for the time being," BlackRock CEO Larry Fink said on a conference call last week (see MFWire, 6/12/2009).

Ameriprise's interest may not surprise industry insiders. Ameriprise bought J.W. Seligman last year for $440 million (see MFWire, 11/10/2008), and speculation about the RiverSource parent's deal hunger arose last week after the brokerage revealed plans for a $900 million public offering (see MFWire, 6/10/2009). An industry insider told MFWire that Ameriprise's bid would be only for the non-money market portion of Columbia's business.

Another insider noted that one plus for Ameriprise might be Don Froude. Currently president of the personal advisors group at Ameriprise, Froude once led intermediary distribution for Columbia.

As for Invesco, the firm has finished digesting its acquisition of PowerShares from 2006 (see MFWire, 1/23/2006). And, like Ameriprise, Invesco also raised some new money within the past month: on May 18 Invesco unveiled a $400 million public offering, and on June 9 Invesco unveiled a new $500 million "revolving bank credit facility," both earmarked broadly for "general corporate purposes."

Nuveen, meanwhile, is backed by private equity firm Madison Dearborn Partners, which acquired the Chicago-based asset manager back in 2007 (see MFWire, 6/20/2007 and 9/18/2007). 

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