Jupiter Fund Management shares soared on Thursday after the asset manager announced the acquisition of CCLA for £100m and separately outlined plans to return capital to shareholders.
Jupiter shares were 11% higher at the time of writing.
CCLA is the UK’s largest asset manager focused on serving non-profit organisations, managing more than £151 billion on behalf of charities, religious institutions and local authorities.
The acquisition aligns with Jupiter’s strategic objective of expanding its presence within its home market. Following completion, almost 75% of the combined group’s £59 billion of assets under management will be from UK-based clients.
“This Acquisition helps us to increase scale in our home market of the UK, where Jupiter is already a leading player, without any disruption to our existing clients,” said Matthew Beesley, Chief Executive Officer of Jupiter.
“It opens up a new client segment for us, broadening our appeal to a range of charitable and religious institutions, both in the UK and internationally, while also allowing us to expand our existing presence in the UK Local Authority sector.”
Jupiter has identified an initial target for run-rate cost synergies of at least £16 million per annum on a fully integrated basis, expected to be fully realised by the end of 2027.
Both the CCLA brand and its investment teams will be preserved to ensure continuity of service for existing clients. Peter Hugh Smith, CCLA’s chief executive, will remain with the combined group alongside his senior management team.
In addition to the announcement of the CCLA acquisition, and perhaps the driving force behind today’s share price gains, Jupiter unveiled plans to boost returns to shareholders by distributing 50% of performance fee-related revenue via a share buyback or special dividend. This would be in addition to the 50% of pre-performance fee earnings that are already returned via ordinary dividends.