10 October 2019: Merian Global Investors (MGI) has today announced that it has signed an agreement to acquire the top-performing multi-asset business from Kestrel Investment Partners¹.
As part of the deal, which is expected to complete in December 2019 (subject to regulatory and shareholder approval), the entire Kestrel multi-asset team will join MGI, including head of desk and lead fund manager John Ricciardi. He will report to MGI’s CEO, Mark Gregory. John is joint CEO of Kestrel, a business he co-founded with the partners of Kestrel Partners LLP in 2011. He has over three decades of multi-asset investing experience, including six years as global head of asset allocation for Alliance Bernstein.
Management of the $151 million² Kestrel Global Portfolio will transfer to MGI as part of the transaction, as will the associated intellectual property. The fund will adopt the “Merian” naming convention immediately upon completion, with its new name announced in due course. The fund aims to achieve capital growth by directly investing in a diversified portfolio of asset classes across global markets, using a repeatable process of quantitative macro modelling, combined with fund manager expertise. The team has an outstanding long-term track record, with the Kestrel Global Portfolio (I USD) delivering a compound annual return of 6.2%, compared to 2.4% for the peer index since inception.³
Joining MGI with John are portfolio managers Ian Forrest and Dan Matthews. The three fund managers have been investing together for the past seven years, including developing a proprietary macro modelling system. The investment team will be accompanied by three system analysts who have played a key role in evolving the desk’s investment process.
The acquisition is MGI’s first deal since it completed a management buyout in June 2018 and reflects its attractiveness as a destination for top industry talent, due to its no-CIO policy, strong brand and extensive distribution network.
The deal is aligned with MGI’s strategy to grow and diversify its investment capabilities in asset classes where it can add meaningful value for its clients. Flexible multi-asset strategies are popular with investors seeking to diversify their portfolios. In addition to growing its existing fund, the new multi-asset team will be launching a long/short strategy in early 2020, subject to regulatory approval. This proposal reflects MGI’s ambition to expand its liquid alternative capabilities, an asset class that is growing in demand among both wholesale and institutional investors.
Mark Gregory, CEO, Merian Global Investors, comments:
“For some time we’ve been looking to selectively expand our investment proposition, aligned with client demand for differentiated, high-alpha active strategies that offer genuine portfolio diversification. The Kestrel multi-asset team’s proven process is hugely compelling and I’m delighted that we’ve signed an agreement to secure its best-in-class business.
“John and his colleagues are hugely experienced and have a fantastic track record. With the backing of our strong distribution presence and the launch of a new long/short strategy, we’re confident that we will be able to grow the team’s assets under management. I look forward to welcoming them to the business at the end of the year.”
John Ricciardi adds:
“Merian Global Investors is an ideal home for our ambitious team. It is an incredibly well-respected asset manager with a reputation for innovation and a positive, entrepreneurial culture. The support of MGI’s talented distribution and operational teams will allow us to develop and grow our strategy, while its commitment to having “no house style” will afford us the freedom to manage our products with the flexibility that’s resulted in long-term outperformance for our investors.”
Ari Zaphirirou Zarifi, chairman of Kestrel Partners said:
“Having launched Kestrel’s global asset allocation business in 2011 under the Kestrel Investment Partners brand name, John has consistently delivered outstanding returns. As well as a strong track record, John has also built an excellent team and now is the right time for them to move to a larger platform where they can capitalise on the success they have had at Kestrel. This is a great outcome for all parties and we wish John and his team all the best for a successful future with Merian Global Investors.”
Notes to editors
¹ Kestrel Investment Partners is the trading name of an entity made up of two partnerships: Kestrel Partners and Kestrel Investment Partners LLP.
² As at 30 September 2019.
³ Kestrel Global Portfolio, I USD share class versus Morningstar USD Flexible Allocation Index, since April 2012. As at 30 September 2019.
John Ricciardi is joining Merian Global Investors as head of desk and multi-asset portfolio manager. John has over forty years of investing experience and co-founded Kestrel Investment Partners LLP in 2011. Before Kestrel, he was head of global asset allocation for Iveagh, a position he held for four years. He has extensive experience in multi-asset investing having founded Bullrun Financial, and held positions including head of global asset allocation for Alliance Bernstein, which had $450bn assets under management worldwide and Cursitor, where he was responsible for the $10bn Global Asset Rotation Fund.
Ian Forrest is joining Merian Global Investors as a multi-asset portfolio manager. He joined Kestrel in 2012, and has co-managed the Kestrel Global Portfolio since launch. Ian has worked in investment management for over 20 years, including seven years in senior management roles at RAB Capital plc.
Dan Matthews is joining Merian Global Investors as a multi-asset portfolio manager. He joined Kestrel in 2017 after working as a consultant to the group since the launch of the Kestrel Global Portfolio in 2012. Prior to Kestrel, Dan worked at Hilltop Fund Management as a senior analyst. He started his career as a product specialist and analyst at Signet Capital Management in 2007.
Ravi Kishore Booka is joining Merian Global Investors as head quant analyst for the multi-asset desk. He has worked as chief technology officer for Kestrel since 2011and has played a key role in developing the investment process and research effort. Prior to joining Kestrel, Ravi worked for Iveagh as a technology consultant. He has over 14 years’ experience in software development.
Pramila Prasingu is joining Merian Global Investors as a developer for the multi-asset desk. Pramila joined Kestrel in 2011 and works as web administrator and data analyst. She began her career with Andhra Bank in India and moved to the UK in 2010 to pursue a Master’s degree in computer networks. While studying for this, Pramila gained financial sector experience at Iveagh.
Sarath Kotamarthi is joining Merian Global Investors as a quant analyst for the multi-asset desk. Sarath joined Kestrel in December 2012 and is responsible for organising, analysing and reporting on non-macro-economic and financial market data in support of Kestrel’s internal systems. He began his career with PC DOCTOR 24 and has completed his BSc in computer science in India and MSc in computer networking.