HENDERSON, like so many others, took quite a battering from the financial crisis. When current boss Andrew Formica took over in November 2008, the Bishopsgate-based firm had lost around three-quarters of its value.
Yet we are now, without wanting to tempt fate, in calmer waters – and the good ship Henderson appears to be steady. The fund manager’s shares hit a fresh record high towards the end of 2013, and seem to be on a promising upward trajectory.
The acquisition of Geneva Capital Management, announced yesterday and set for completion by October, has reassured investors even more.
The stock had ticked up 1.9 per cent by yesterday’s close of play, suggesting that this will be $200m – if the total cost is met – well spent.
It’s not hard to see why. The deal should be earnings accretive, provide decent cost savings, and also cushion Henderson by diversifying its products, channels, and which economies it is exposed to.
It’s nice to have these boxes ticked, yet the real reason to get excited is that the move reveals Henderson’s desire to crack the US. Just like in pop music, the stars of asset management know that you cannot claim to be a global success until you’ve conquered the other side of the pond.
This deal is not an instant No1 hit. It’s not a jump in the deep end. But it is a wise attempt to build on the organic growth that the firm has shown in America. Watch this space.