CC-BY-SA-2.0, FlickrPhoto: Joe Cheng. Eaton Vance to Acquire Calvert Investment Management
Eaton Vance recently announced the execution of a definitive agreement to acquire the business assets of Calvert Investment Management, an indirect subsidiary of Ameritas Holding Company. In conjunction with the proposed acquisition, the Boards of Trustees of the Calvert mutual funds have voted to recommend to Fund shareholders the approval of investment advisory contracts with a newly formed Eaton Vance affiliate, to operate as Calvert Research and Management, if the transaction is consummated.
Calvert is a recognized leader in responsible investing, with approximately $12.3 billion of fund and separate account assets under management as of September 30, 2016. The Calvert Funds are one of the largest and most diversified families of responsibly invested mutual funds, encompassing actively and passively managed U.S. and international equity strategies, fixed income strategies and asset allocation funds managed in accordance with the Calvert Principles for Responsible Investment. As a responsible investor, Calvert seeks to invest in companies that provide positive leadership in their business operations and overall activities that are material to improving societal outcomes.
Founded in 1976, Calvert has a long history in responsible investing. In 1982, the Calvert Social Investment Fund (now Calvert Balanced Portfolio) was launched as the first mutual fund to oppose investing in South Africa’s apartheid system. Other Calvert innovations include the first responsibly managed fixed income and international equity funds, and pioneering programs in shareholder advocacy, corporate engagement and impact investing.
“I am extremely pleased that Eaton Vance has chosen to make Calvert the centerpiece of its expansion in responsible investing,” said John Streur, President and Chief Executive Officer of Calvert. “By combining Calvert’s expertise in sustainability research with Eaton Vance’s investment capabilities and distribution strengths, we believe we can deliver best-in-class integrated management of responsible investment portfolios to investors across the U.S. and internationally. Eaton Vance is the ideal partner to help Calvert fulfill its mission to deliver superior long-term performance to clients and achieve positive impact.”
“As part of Eaton Vance, we see tremendous potential for Calvert to extend its leadership position among responsible investment managers,” said Thomas E. Faust Jr., Chairman and Chief Executive Officer of Eaton Vance. “By applying our management and distribution resources and oversight, we believe Eaton Vance can help Calvert become a meaningfully larger, better and more impactful company.”
Completion of the transaction is subject to Calvert Fund shareholder approvals of new investment advisory agreements and other closing conditions, and is expected on or about December 31, 2016. Because the transaction is structured as an asset purchase, liabilities in connection with Calvert’s previously disclosed compliance matters and other pre-closing obligations will remain with the seller. Terms of the transaction are not being disclosed.
CC-BY-SA-2.0, FlickrPhoto: Joey Gannon
. China Oceanwide To Acquire Genworth Financial
China Oceanwide Holdings and Genworth Financial, have announced that they have entered into a definitive agreement under which China Oceanwide has agreed to acquire all of the outstanding shares of Genworth for a total transaction value of approximately $2.7 billion, or $5.43 per share in cash. The acquisition will be completed through Asia Pacific Global Capital, one of China Oceanwide’s investment platforms. The transaction is subject to approval by Genworth’s stockholders as well as other closing conditions, including the receipt of required regulatory approvals.
As part of the transaction, China Oceanwide has additionally committed to contribute to Genworth $600 million of cash to address the debt maturing in 2018, on or before its maturity, as well as $525 million of cash to the U.S. life insurance businesses. This contribution is in addition to $175 million of cash previously committed by Genworth Holdings. to the U.S. life insurance businesses. Separately, Genworth also announced preliminary charges unrelated to this transaction of $535 to $625 million after-tax associated with long term care insurance (LTC) claim reserves and taxes. Those items are detailed in a separate press release. The China Oceanwide transaction is expected to mitigate the negative impact of these charges on Genworth’s financial flexibility and facilitate its ability to complete its previously announced U.S. life insurance restructuring plan. Genworth believes this transaction is the best strategic alternative to maximize stockholder value.
James Riepe, non-executive chairman of the Genworth Board of Directors said, “The China Oceanwide transaction is the result of an active and extensive review process conducted over the past two years under the supervision of the Board and with guidance from external financial and legal advisors. The Board is confident that the sale of the company to China Oceanwide is the best path forward for Genworth’s stockholders.”
Upon the completion of the transaction, Genworth will be a standalone subsidiary of China Oceanwide and Genworth’s senior management team will continue to lead the business from its current headquarters in Richmond, Virginia. Genworth intends to maintain its existing portfolio of businesses, including its MI businesses in Australia and Canada. Genworth’s day-to-day operations are not expected to change as a result of this transaction.
China Oceanwide is a privately held, family owned international financial holding group founded by Lu Zhiqiang. Headquartered in Beijing, China, China Oceanwide’s well-established and diversified businesses include operations in financial services, energy, culture and media, and real estate assets globally, including in the United States. Businesses controlled by China Oceanwide have more than 10,000 employees globally.
“Genworth is an established leader in both mortgage insurance and long term care insurance, which are markets that present significant long-term growth opportunities,” added Lu, Chairman of China Oceanwide. “We are impressed by Genworth’s purpose and its focus on helping people manage the financial challenges of aging as well as achieving the dream of homeownership. In acquiring Genworth and contributing $1.1 billion of additional capital, we are providing crucial financial support to Genworth’s efforts to restructure its U.S. life insurance businesses by unstacking Genworth Life and Annuity Insurance Company (GLAIC) from under Genworth Life Insurance Company (GLIC) and address its 2018 debt maturity. In order to close the transaction and achieve these objectives, we have structured the transaction with the intention of increasing the likelihood of obtaining regulatory approval.”
Tom McInerney, President & Chief Executive Officer of Genworth concluded, “We believe that this transaction creates greater and more certain stockholder value than our current business plan or other strategic alternatives, and is in the best interests of Genworth’s stockholders. China Oceanwide is an ideal owner for Genworth going forward. They recognize the strength of our mortgage insurance platform and the importance of long term care insurance in addressing an aging population. The capital commitment from China Oceanwide will strengthen our business and increase the likelihood of obtaining regulatory approval.”
CC-BY-SA-2.0, FlickrPhoto: Wealth Gail. Natixis Global Asset Management and AlphaSimplex Bring Managed Futures Alternative Strategy to Europe
Natixis Global Asset Management has strengthened its European SICAV range with the launch of a new managed futures fund from one of its leading affiliates focused on alternatives, AlphaSimplex Group, LLC.
AlphaSimplex’s Managed Futures Fund will invest in futures and forward contracts across a broad range of markets including equities, fixed income and currencies and aims to profit from current trends in the markets, taking long positions in assets in a rising price trend and short positions in those that are in a falling price trend. The fund also has indirect exposure to commodity markets.
The new fund will be quantitatively driven with full transparency and will be co-managed by a team of five Portfolio Managers. Although the fund has only recently become available to European investors, AlphaSimplex has a six year track record in the U.S. managing over $3.5bn in its Managed Futures strategy.
“In a world that has become more and more interconnected, correlation has increased”, said Duncan Wilkinson, CEO of AlphaSimplex. We believe this product can be implemented as a strong diversifier in an equity-dominated portfolio.”
Commenting on the new fund, Chris Jackson, Deputy CEO – International Distribution at Natixis Global Asset Management, said: “Through Natixis’ regular investor surveys we believe that individuals are becoming increasingly aware of the need to have an allocation to alternatives within a portfolio. As managed futures are typically uncorrelated to other asset classes, these strategies can be a useful way of diversifying an investor’s portfolio. AlphaSimplex has a solid track record, supported by an experienced team of managers and we believe that this successful offering will resonate well in the European marketplace.”
CC-BY-SA-2.0, FlickrPhoto: Pexels. The UHNWI, the 0.004% of the World’s Adult Population that Control 12% of the World's Wealth
According to the World Ultra Wealth Report 2015-2016 produced by Wealth-X, there are 212,615 ultra high net worth (UHNW) individuals globally, holding a combined wealth of US$30 trillion in net assets.
The fourth edition of this leading report on the world’s ultra wealthy population shows almost flat growth in 2015 as the number of individuals with US$30 million or more in net assets grew just 0.6% and total UHNW wealth increased by 0.8%. Despite this meager growth, UHNW individuals, who account for just 0.004% of the world’s adult population, still control 12% of its wealth.
Regional Differences in UHNW Growth Trends
In Europe, the Middle East and Africa UHNW wealth fell 2.4% as equity markets, local currencies and gross domestic product collectively experienced negative net returns. By contrast, Asia-Pacific experienced a 3.9% rise as the ultra wealthy in certain markets continued to benefit from dynamic business expansion and economic growth. In the Americas, it was Latin America, rather than North America, that helped the region achieve a modest 1.5% growth in ultra wealth value.
Across all geographic regions, it is the highest ranks of the UHNW population who are experiencing the most success. The report highlights that in 2015 billionaires saw their wealth grow 5.4%, more than double the rate of global economic growth, while collectively other tiers saw their wealth shrink by 0.6%.
Driven by Wealth-X’s unparalleled collection of hand curated dossiers on the global UHNW population, the World Ultra Wealth Report contains detailed analysis of the wealthiest individuals in the world with a focus on geography, lifestyle, social networks, philanthropic behaviors, motivations and legacy.
Additional key findings from the report include:
UHNW global wealth is expected to reach US$46.2 trillion by 2020
UHNW wealth is expected to grow at a compound annual growth rate of 9%.
The UHNW population is expected to exceed 318,000 by 2020.
Female UHNW individuals saw their wealth decrease
While the female UHNW population remained steady at 13%, their share of total UHNW wealth fell from 14% to 11% this year. Average female high net worth wealth dropped from US$147 million to US$126.3 million.
Male wealth increased 2.4% from US$139.8 million to US$143.1 million, reflecting a greater focus on self-made wealth and a higher-risk asset composition.
Finance, banking and investment remains the top UHNW industry
Though its lead among other UHNW industries continues to shrink as manufacturing grows in importance.
In two out of three cases, wealth is purely self-made rather than inherited. As wealth matures in younger economies, the transfer of wealth has seen a growing class of second-generation ultra wealthy emerge.
Wealth continues to rise generation by generation
The under-30 demographic accounts for just 1% of the world’s ultra wealthy population and 0.3% of global UHNW wealth.
UHNW individuals aged 80 or over are seven times wealthier than those under 30 and are worth nearly double that of the average UHNW individual globally.
CC-BY-SA-2.0, FlickrPhoto: Ron Cogswell. The Two-Track U.S. Economy
Many market watchers interpreted the September U.S. jobs report as a bit of a disappointment, as jobs growth came in slightly weaker than expected. But I think it was a decent report, fairly in line with where I expect the U.S. economy to be given that it’s moving on two tracks.
What do I mean by that? We’re currently witnessing a U.S. economy in which both consumption and employment in the services sectors have been amazingly robust, while expenditures and employment in good-producing segments remain softer. The September report showed this longstanding trend is continuing, with strong employment growth in service sectors, such as health care and education, and especially in professional business services (up a strong 67,000 last month). In contrast, the manufacturing sector lost another 13,000 jobs, continuing short-term and long-term trends. In fact, manufacturing employment peaked in June 1979, roughly four decades ago, with nearly 20 million jobs in the sector (or 1 in every 5 employees). At its trough in 2010, there were only 11.4 million manufacturing jobs in the U.S. (or less than 1 in 10 employees).
There are both demographic and technological underpinnings behind this two-track trend, as an aging population and innovations in technology boost employment in service industries that tend to be much more labor intensive.
September’s labor force participation rate numbers are another sign of the trend, showing strong demand for human capital in today’s new economy is sending more people back into the workforce. Indeed, the participation rate has rebounded from 2015 lows, and is now back around 63%. See the chart below. The recent uptick in labor force participation is even more impressive when judged alongside an aging population, as many more people are exiting the workforce today (i.e., retiring) than we’ve experienced in prior decades.
The U.S. economy is also running along two separate tracks in another sense. We’ve seen strong employment growth in recent years, but merely decent levels of reported gross domestic product growth. Some say the incredible employment numbers reflect a poor-productivity economy. These arguments suggest that we have needed to hire many more people to produce a relatively smaller amount of goods, as if production and labor output were diminished in their ability to generate aggregate output. I believe this is a misguided interpretation of the economic landscape due to the fact that traditional productivity and output numbers don’t capture the downward influence of new technologies on prices.
The bottom line: The two-track trends evident in the September jobs report are just more signs that the U.S. economy is doing better than headline numbers may imply. So where does this leave us from a monetary policy perspective? The Federal Reserve can, and will likely, move policy rates at its December meeting, barring an unexpected shock to the economy or markets.
Build on Insight, by BlackRock written by Rick Rieder.
Eric Figueroa - Courtesy photo. Eric Figueroa Joins MFS as Director, Responsible for Sales in Southeastern US, Caribbean and Central America
MFS Investment Management has announced the hiring of Eric M. Figueroa, CIMA, as an associate director and wholesaler for MFS International Ltd. (MIL). Based in Miami, Florida, he will be responsible for the sale of MFS Meridian Funds, working with advisors across all channels, including family offices, independents, banks and wirehouse firms. His coverage area includes the southeastern United States, the Caribbean and Central America.
“Eric brings tremendous experience to this role, having worked previously as a private banker in the region. He understands the role the financial advisor plays in helping clients achieve their long-term goals and the value an investment manager must bring to the equation,” said L. Jose Corena, managing director – Americas for MFS. “His depth of perspective as a former client in the sales process will be invaluable as we continue to grow our presence across these key regions.”
Figueroa will report to Corena. He will work closely with members of MFS’ sales and client service teams, partnering and coordinating sales coverage and support for the southeastern United States, Caribbean and Central American regions with senior team member Paul Brito, CIMA, regional director, and Natalia Rodriguez, senior internal sales representative.
Figueroa joins MFS from Itau International Securities, where he worked as a financial advisor in private banking for three years. He previously worked for HSBC for ten years, most recently as a financial advisor. He began his career in financial services with HSBC in 2003. He earned a bachelor’s degree in international finance and marketing from the University of Miami and attended the executive education program at the Wharton School at the University of Pennsylvania. Figueroa holds the Certified Investment Management Analyst (CIMA) designation from the Investment Management Consultants Association. He also holds the Financial Industry Regulatory Authority (FINRA) Series 6, 7, 63 and 65 and the Florida Life Health Variable Annuity licenses.
Martin Hofstadter - courtesy photo. Martin Hofstadter Has Joined Lord Abbett as Director, Offshore Business Development,The Americas
Martin Hofstadter will join Lord Abbett’s International team as Director, Offshore Business Development – The Americas. In his new role, he will be based in Miami and will work with Nicolette Iorio, Associate, International Investor Services and report to Andrew D. D’Souza, Partner, International Investor Services at Lord Abbett.
Hofstadter will be responsible for the firm’s efforts to maintain and expand its offshore business in the Americas, including the NRC market and Latin America with a focus on wirehouses, private banks and independent advisors. “Martin brings a tremendous amount of proven experience to the team,” said D’Souza. “His insights and knowledge will be invaluable as we work together to expand our presence in the international market.”
Before joining Lord Abbett, Hofstadter worked at Man Group for 14 years as Managing Director and Principal with responsibility for offshore distribution in the U.S. and LatAm. He has a BA in finance from ROU and is a CFA charterholder.
Photo: visitmonaco.com. HSBC clients in Monaco to join CFM Indosuez Wealth Management
CFM Indosuez Wealth Management, which represents the Indosuez Wealth Management network in Monaco, has announced an agreement with HSBC Private Bank to welcome clients from HSBC’s client base in the Principality of Monaco.
The firm said this agreement is in line with Indosuez Wealth Management Group’s strategy to bolster its positions with ultra-high-net-worth-individuals clients in its key markets.
The deal also strengthens CFM Indosuez Wealth Management’s leadership as the largest bank in Monaco.
“The referral process will begin immediately. CFM Indosuez Wealth Management will work closely with HSBC to ensure the smoothest possible process for the clients,” the company commented.
Indosuez Wealth Management had €110bn of assets under management at the end of 2015.
Photo: Pixabay. PwC Launches an Education Platform Addressing the Barriers to Financial Investing
European citizens are required, more than ever, to invest their savings on the capital markets to save for their future pension, while contributing to the financing of the European economy. At the same time, financial products and financial regulation are increasingly complex while investor education remain a challenge. In this context, PwC has just launched Buzz4Funds, an education platform dedicated to raising public understanding of financial investing, including through investment funds.
The primary goal for this programme, currently made up of a series of ten videos and a website, is to arm millennial investors with the unbiased and non-commercial information they need to make investing decisions.
“Investor education is complementary to the traditional tools of investment product information, financial reports and other required communications,” says Steven Libby, partner and Asset & Wealth Management Leader at PwC Luxembourg.
The Investor Education video series covers topics ranging from understanding the difference between saving and investing to the red flags of investment to selling.
“These funny videos aim to grab the attention of potential of future investors, triggering their curiosity to visit the dedicated website where they will discover explanations and links to additional material,” explains Nathalie Dogniez, partner at PwC Luxembourg
To watch the videos and discover the related messages, you can visit the Buzz4Funds website.
Amundi confirmed on Wednesday that it is interested in acquiring Pioneer Investments, UniCredit’s asset management arm.
Following rumours in the Italian newspaper Il Messaggero, concerning the submission of a non binding offer for the purchase of Pioneer by Amundi, Amundi issued a press release to confirm its interest in Pioneer, since it is “consistently with the growth strategy presented at the time of its IPO.”
However, in the same statement, Amundi denied the close to $4.39 billion valuation attributed to Pioneer in said article and specified that “Amundi re-iterates that its acquisition policy adheres to strict financial criteria, in particular, a return on investment greater than 10% over a three-year horizon.”
However it seems that Jean-Pierre Mustier, Unicredit’s new CEO and a former Société Générale executive, is set to part ways with Pioneer, which has been placed on UniCredit’s group-wide strategic review since last July, when he stated they would even consider a potential IPO. “This is to ensure the company has the adequate resources to accelerate growth and continue to further develop best-in-class solutions and products to offer its clients and partners.”
Publicly traded since November 2015, Amundi is the largest European Asset Manager in terms of AUM, with over 1,000 billion euros worldwide.
