Franklin Resources, a global investment management organization operating as Franklin Templeton, announced a strategic partnership with Power Corporation of Canada and Great-West Lifeco.
The Power Group of Companies including Great-West and IGM Financial are leaders in the global insurance, retirement, asset management and wealth management sectors and have collective assets under management and/or administration of approximately $2.1 trillion.
Great-West includes Empower in the US as well as Canada Life in Canada and Irish Life in Europe. IGM encompasses subsidiaries Mackenzie Financial and IG Wealth Management and also has investments in Rockefeller Capital Management and China Asset Management Co.
As a foundation of the partnership, Franklin Templeton has entered into a definitive agreement to acquire Putnam Investments (“Putnam”) from Great-West for approximately $925 million of primarily equity consideration. Great-West will become a long-term strategic shareholder in Franklin Resources, Inc., with an approximate 6.2% stake, consistent with Great-West’s continuing commitment to asset management.
Great-West will provide an initial long-term asset allocation of $25 billion to Franklin Templeton’s specialist investment managers within 12 months of closing with that amount expected to increase over the next several years. The strategic partnership aligns with Franklin Templeton’s focus to further grow insurance client assets, and significantly broadens the relationship between Franklin Templeton and the Power Group of Companies in key areas of retirement, asset management and wealth management.
Founded in 1937, Putnam is a global asset management firm with $136 billion in AUM as of April 2023. Putnam has offices in Boston, London, Munich, Tokyo, Singapore and Sydney. Putnam’s complementary capabilities and track record of strong investment performance accelerates Franklin Templeton’s growth in the retirement markets by increasing its defined contribution AUM and expanding its insurance assets, while adding further scale and efficiency to Franklin Templeton’s mutual fund platform.
Consistent with Franklin Templeton’s previous acquisitions, the execution plan is designed to minimize disruption to Putnam’s investment teams and client relationships.
“This is a compelling transaction for Franklin Templeton, and we are excited about the numerous opportunities that will be unlocked by this long-term strategic partnership with the Power Group of Companies including Great-West,” said Jenny Johnson, President and CEO of Franklin Templeton. “Power and Great-West are global leaders across financial services, particularly in the wealth, insurance and retirement channels. With outstanding investment performance, Putnam will add complementary capabilities to our existing specialist investment managers to meet the varied needs of our clients and will increase Franklin Templeton’s defined contribution AUM. We are pleased to welcome Great-West as a strategic investor, along with the impressive team at Putnam.”
“Franklin Templeton is a leading global asset management firm, whose business model is well-positioned to build upon the investment and distribution strengths of Putnam,” said R. Jeffrey Orr, Chair of Great-West, and President and CEO of Power. “We are pleased to enter a partnership with Franklin Templeton that will be mutually beneficial to clients and our respective businesses.”
“This transaction furthers Great-West’s strategy of building strategic partnerships with best-in-class asset managers to support our client’s retirement, insurance, and wealth management needs,” said Paul Mahon, President and CEO of Great-West. “Franklin Templeton’s scale and breadth, together with Putnam’s capabilities, will drive positive outcomes for our companies, our clients, and our investors.”
“Critical to this transaction is the strong alignment between our organizations. We share a client-centric culture, a core belief in active management, a collaborative and research-based investment approach, and a long-held commitment to fundamental investment principles,” said Robert Reynolds, President and CEO of Putnam. “We look forward to joining Franklin Templeton in this next phase of our growth, as we come together to serve our clients, upholding our commitment to them and their needs.”