RBC deepens fixed income expertise with acquisition of BlueBay Asset Management

Date: Tuesday, October 26, 2010
Author: HedgeTracker

BlueBay Asset Management plc (LSE: BBAY) and Royal Bank of Canada (NYSE: RY) recently mutually announced that RBC would be acquiring BlueBay. In accordance with the agreement, BlueBay shareholders will receive a 29% premium on the firm’s October 15 closing price, or ($7.61) per share. RBC will be using its cash reserves to fund the acquisition. “BlueBay is an ideal fit with RBC’s growing asset management business and we are confident that this transaction will benefit clients, employees and shareholders of both firms,” stated George Lewis, the group head of RBC Wealth Management, in a press release.

BlueBay will maintain its operational independence and continue to manage its investments after the acquisition. “Our board is unanimously recommending this combination with RBC because of the clear benefits it affords the firm’s shareholders, clients and employees,” commented BlueBay chairman Hans-Jörg Rudloff. BlueBay shareholders will receive formal documentation regarding the acquisition in November, and BlueBay and RBC expect the transaction to close by December of this year.
 

BlueBay Asset Management is a fixed income manager with $40 billion in assets under management that was founded in 2001 by Hugh Willis and Mark Poole. The firm offers three distinct asset management styles to institutional and high net worth individuals – long only funds, long/short funds and structured products. The BlueBay funds focus on fixed income strategies, with emphasis on investment grade corporate debt, high yield corporate debt, and emerging market debt. BlueBay has been publicly traded on the London Stock Exchange since November 2006. The firm is based in London and has offices in Tokyo and New York.