Pramerica acquires Deutsche's India asset management business

Pramerica Asset Managers Pvt. Ltd said on Friday that it had signed a definitive agreement with Deutsche Bank AG to acquire the latter's India asset management business.

The combined business will enable Pramerica AMC to expand its investment management expertise, distribution platform and product portfolio significantly in India, the money manager said in a statement. The transaction is subject to approval by the Securities and Exchange Board of India and the Competition Commission of India. Pramerica AMC did not disclose the value of the transaction. Prudential Financial Inc., a US-based financial services company, owns and is the sponsor of Pramerica Asset Managers. On 17 June, Mint reported that Pramerica AMC was buying out Deutsche Asset Management (India) Pvt. Ltd, a money manager with 10 times the asset size of Pramerica, for almost Rs.400 crore.

Deutsche Asset Management was formed in 2003, and is the second-largest foreign-owned asset manager in the country, the statement said. In the first quarter of the current financial year, the business had and average Rs.20,720 crore ($3.2 billion) of assets under management.

"The strong track record of Deutsche Bank's asset management business in India, its talented leadership team, and deep relationships with institutional clients and distribution partners, perfectly complement the sales, investment and product capabilities of our existing business," said Glen Baptist, chief executive officer of Pramerica International Investments.

Once the transaction is completed, Pramerica will have the scale and platform to make its investment strategies available to clients across India and put Pramerica within sight of the top 10 asset managers in the country, he said.

Deutsche Asset Management is the fourth foreign-owned fund house to leave India since December 2013, when Morgan Stanley Investment Management Co. Ltd had its schemes acquired by HDFC Asset Management Co. Ltd. In May 2014, Birla Sun Life Asset Management Co. Ltd acquired the schemes of ING Investment Management (India) Pvt. Ltd and in September, Kotak Mahindra Asset Management Co. Ltd purchased the assets of PineBridge Investments Asset Management Co. Ltd. Pramerica AMC has a presence in 19 cities across the country including branches in Ahmedabad, Bangalore, Chennai, Delhi, Hyderabad, Kolkata and Pune. Pramerica AMC's other interests in India include a proposed joint venture partnership with Dewan Housing Finance Corp. Ltd, which recently received approval from Sebi, and is expected to be completed shortly.