Franklin Templeton to acquire OSAM

STAMFORD — O’Shaughnessy Asset Management announced this week that it had agreed to be acquired by investment management giant Franklin Templeton, but the firm will stay in Stamford after the transaction is completed.

OSAM officials cited their belief that the acquisition would drive further growth of their firm’s custom-indexing platform, Canvas.

Canvas has grown significantly since its launch in late 2019 and now comprises about $1.8 billion of OSAM’s approximately $6.4 billion in assets under management.

Custom indexing represents a growth area in asset management. Canvas allows financial advisers to build and manage custom indexes in separately managed accounts that reflect clients’ needs, preferences and objectives, according to OSAM officials.

“Custom indexing represents the next progression of investing through indexing, ETFs (exchange-traded funds) and direct indexing,” OSAM CEO Patrick O’Shaughnessy said in a statement. “As part of Franklin Templeton, we’ll have the opportunity to accelerate client growth at Canvas and continue to add to existing OSAM offerings. We’re excited by the incredible potential this acquisition creates and look forward to getting started.”

The acquisition, whose price was not disclosed, is scheduled to close by the end of 2021.

“Technological advances are reshaping how financial solutions are delivered, and we continue to invest in innovative technology to enhance client outcomes and their experience,” Franklin Templeton CEO and President Jenny Johnson said in a statement. “Custom indexing is aligned with our commitment to bringing sophisticated customization to a broader investment audience, and I’m excited to welcome the OSAM team to Franklin Templeton.”

In a letter to clients posted on OSAM’s website, O’Shaughnessy said the deal reflected “extensive talks between our two firms to ensure a proper fit.

“Key for us was our shared vision for the future of asset management, the ability to continue to serve our clients as we have before, the preservation of our distinct firm culture and the ability to access Franklin Templeton’s expertise and resources across every critical area of asset management,” O’Shaughnessy said in the letter. “Franklin Templeton has a long history of successfully acquiring investment managers, owning them for the long haul, allowing them to operate independently and helping them thrive.”