Birla Sun Life Asset Management Company, part of the Aditya Birla Financial Services Group, has acquired the mutual fund schemes and portfolio management services of ING Investment Management (India), part of the Dutch financial services company ING.
With this acquisition, Birla Sun Life MF has added Rs 1,100 crore to its assets under management (AUM). The Birlas did not disclose the valuations of the deal. Market sources say it is about two per cent of the assets acquired.
This is yet another exit of a foreign mutual fund from its Indian operations. The Dutch financial services company has been looking to exit its AMC and insurance business in Asia for long. In recent years, the US's Fidelity and Morgan Stanley sold their AMC businesses to L&T MF and HDFC MF, respectively.
Ajay Srinivasan, chief executive of Financial Services at Aditya Birla group, said, “We have bought over schemes and are committed to providing our products and services to over 75,000 customers of ING Investment Management in India.”
Birla Sun Life MF is India's fourth largest asset management company (AMC) with assets worth Rs 1 lakh crore. Earlier this year, at least five fund houses had been looking to buy ING's local assets. L&T Mutual Fund, Axis Mutual Fund and BNP Paribas were the big names that had shown interest.
A Balasubramanian, CEO, Birla Sun Life MF, said, "We found a strategic fit in the acquisition of schemes of ING Investment Management. Beyond AUM, this adds to our existing investor base and we see an opportunity to increase penetration.” ING Investment Management, which had assets under management of Rs 563 crore in its domestic mutual fund business as on March 31, 2014. Under the portfolio management services business, it manages AUM to the tune of about Rs 400 crore.
In recent years, the country's mutual fund industry has witnessed many acquisitions as several smaller fund houses are finding it unviable to operate in India because of the recent slump in stock markets and a lack of investor appetite.