UK fund management by numbers IMAS S Corpora rate te Finance Unrivalled expertise in selling financial services businesses
Fund management is the largest activity across the whole of UK financial services Overview of financial services businesses (2,990 groups) General Insurance 21% The UK financial services sector is Investment dominated by investment businesses, 50% with over 50% of the market (defined as groups with a capital value in excess of £5 Lending million) 16% Financial support services 13% Source: IMAS-insight Overview of the investment sector (1,497 groups) Other Fund 20% Manager Private 21% Client Within the investment sector, 21% of Wealth Manager businesses have been classified as fund 5% managers. IFA Business Hedge Fund 6% 16% Corporate Finance 8% Private Stockbroker Equity 9% 15% Source: IMAS-insight IMAS S Corpora rate te Finance Unrivalled expertise in selling financial services businesses 2
Overseas investment is key to the UK fund management sector £5-100m Fund Management ownership structure Other UK Quoted 6% Overseas 3% Widely Held 34% of fund management businesses Owned 4% that are valued between £5-100 34% million have parents that are overseas. Privately Held 53% Source: IMAS-insight £100m+ fund management ownership structure Other 3% Overseas UK Quoted The largest fund management groups, Owned 19% valued in excess of £100 million, 34% maintain the same level of overseas control. Widely Held 10% Privately Held 34% Source: IMAS-insight IMAS S Corpora rate te Finance Unrivalled expertise in selling financial services businesses 3
The FSA is the principal regulator in the UK, authorising fund management firms and the key individuals within these firms Entities Total Authorised Fund Management Entities 1000 980 960 The number of authorised firms 940 has remained relatively 920 constant over recent times. 900 880 860 840 820 800 Source: IMAS-insight Total Approved Persons working in Fund Management Individuals organisations 12000 11500 There are c. 10,000 authorised 11000 10500 individuals working within the 10000 sector, which has remained 9500 relatively stable over the last 2 9000 years. 8500 8000 Source: IMAS-insight IMAS S Corpora rate te Finance Unrivalled expertise in selling financial services businesses 4
M&A activity in the investment sector has been subdued, but there is a steady flow of transactions being completed Investment deals (Volume) Volume 12 10 8 6 4 2 Whilst deal volume remained robust in 2012, smaller deals 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 were being executed, resulting 2011 2012 in lower deal value Value Investment deal (Value) £3,500 £3,000 £2,500 Millions £2,000 £1,500 £1,000 £500 £0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2011 2012 IMAS S Corpora rate te Finance Unrivalled expertise in selling financial services businesses 5
Overseas firms are the most active acquirers of UK fund management businesses Volume of deals completed in 2011 by buyer type Private Equity 27% Overseas buyers represent the largest Overseas buyer group in 2011 and 2012 Owned 46% UK Quoted 15% Private 12% Volume of deals completed in 2012 by buyer type Overseas Owned Private Equity 27% 27% Most of these overseas buyers have already established a presence in the UK market. Private UK Quoted 15% 23% Partnerships 8% IMAS S Corpora rate te Finance Unrivalled expertise in selling financial services businesses 6
IMAS & UKTI Financial services annual review 2012 The data in these slides is extracted from our recently released our annual review of the UK financial services industry, sponsored by UK Trade & Investment. The review summarises the structure of the industry by activity, size and ownership and includes detailed analysis and commentary on the M&A activity that has shaped the industry in 2012. Further information can be found at both of the following websites: IMAS www.imas.uk.com UKTI http://www.ukti.gov.uk/investintheuk/sect oropportunities/financialprofessionalservic es.html IMAS S Corpora rate te Finance Unrivalled expertise in selling financial services businesses 7
IMAS sector and value banding definitions VALUE BANDING IMAS Value Banding is an indicative sizing of the ultimate UK parent company of the group (“Group”) . This is provided solely for informational purposes and does not purport to be a market-based valuation of the Group in any way. The Value Banding is based on a number of factors including, but not limited to, IMAS’ proprietary models and assumptions (which are subject to change without notice) and publicly available information including turnover, profits, net asset value and the number of approved persons. In certain instances, Groups may not file results with Companies House or may, as is the case with some limited liability partnerships, file results which do not necessarily reflect the underlying profitability of the enterprise. DEFINED SECTOR/ACTIVITY IMAS Defined Sector/Activity is based on a subjective assessment by IMAS of the entity’s principal business activity. IMAS S Corpora rate te Finance Unrivalled expertise in selling financial services businesses 8
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