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* Jupiter Q1 assets under management fall 18.3%
* Merian assets fall 30.2%
* Jupiter says still confident on merits of tie-up
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By Muvija M
April 15 (Reuters) - British asset manager Jupiter Fund
Management said on Wednesday its assets under management
fell 18.3% in the quarter to end-March as fears over the
coronavirus pandemic rattled financial markets.
The sharp fall in assets is set to be mirrored by many other
money managers in the coming weeks after the widespread
lockdowns of hundreds of millions of people in response to the
virus teed up a deep recession and caused markets to tank.
Total assets at the end of March were 35 billion pounds
($44.06 billion), down from 42.8 billion at the end of December,
hit by 2.3 billion pounds of net outflows and market losses of
5.5 billion pounds, Jupiter said in a statement.
"Jupiter has faced challenging market conditions, largely
brought about by the global coronavirus (Covid-19) pandemic,
which has had a significant adverse impact on the economy,
global financial markets including asset values and,
consequently, on our AUM," the company said.
Even worse hit, though, was Merian Global Investors, the
smaller rival that Jupiter agreed to buy just before the full
impact of the coronavirus hit markets.
Assets at Merian fell 6.8 billion pounds to 15.7 billion
pounds, led by markets falls and with net outflows of 2.6
billion pounds, prompting Jupiter to lower some of the expected
benefits of the deal.
Due to the decline in Merian's assets, the estimated
run-rate net management fees for Merian at the end of March were
around 98 million pounds a year, down from around 140 million
pounds at the end of December.
After previously flagging a run-rate operating margin of
between 50%-60%, Jupiter said the lower end of the range would
now be 40%. Despite that, Jupiter said it still backed the deal.
"Despite the market volatility which both firms have
experienced, the strategic and financial rationale of the
Acquisition remains compelling.
"The Jupiter Board believes this Acquisition will enhance
the Group’s position as a leading UK asset manager, providing
increased scale and diversification into attractive new product
areas and creating stronger future growth prospects for the
Enlarged Group."
($1 = 0.7944 pounds)
(Reporting by Muvija M in Bengaluru; editing by Simon Jessop)
