Prudential Corporation Asia aims to acquire a full stake in both Thanachart Fund Management and TMB Asset Management within the next five years to rev up growth of wealth management services and synergise the two firms' capabilities.
Eastspring Investments, the Asian asset management arm of Prudential, has acquired 50.1% of the shares in Thanachart Fund Management from Thanachart Bank (TBank) and Government Savings Bank.
The 4.2-billion-baht acquisition was completed on Dec 27, 2019, with TBank holding the remaining 49.9% share. Thanachart Fund Management has since changed its name to Thanachart Fund Eastspring.
Earlier, Eastspring acquired a 65% share in TMB Asset Management, now TMBAM Eastspring, from TMB Bank in September 2018. The remaining 35% of shares are held by TMB Bank.
With these acquisitions, Eastspring has become Thailand's fourth-largest asset manager, with a market share of 12% and combined assets under management of 668 billion baht through the two asset management firms.
These acquisitions will enable Prudential to provide a wider range of innovative and bespoke investment opportunities, as well as accelerate growth in this market through hundreds of distribution channels from the two asset management firms, said Nic Nicandrou, chief executive of Prudential Corporation Asia.
The merger between TMBAM Eastspring and Thanachart Fund Eastspring will be completed by the end of 2021.
Eastspring will hold around a 60% share in the new asset management company after the merger, with the remaining stake held by TMB Bank and TBank. Eastspring will soon acquire a 100% stake over the next five years.
"We have seen a satisfactory perfor- mance in Thanachart Fund Eastspring and TMBAM Eastspring so far, as they have different strengths," Mr Nicandrou said. "TMBAM Eastspring has a strong passive equity strategy, providing many funds to be on the five-star list ranked by Morningstar Thailand. Thanachart Fund Eastspring is keen in active management strategy, and the fund has received the best bond house award for four years."
With TMBAM Eastspring's assets under management seeing 20% growth last year (compared with Thailand's mutual fund industry's 12% annual growth during the past five years), double-digit growth is expected to continue, he said.