July 2, 2018 / News

Federated boss to bring Hermes’ ESG funds to the US

By Joe McGrath, ESG Clarity

US asset manager Federated Investors has completed its deal to take a 60 per cent stake in British ESG manager Hermes Investment Management, it announced on Monday.

Federated boss to bring Hermes’ ESG funds to the US

US asset manager Federated Investors has completed its deal to take a 60 per cent stake in British ESG manager Hermes Investment Management, it announced on Monday.

Former parent, the BT Pension Scheme retained a 29.5 per cent interest in the business, with a further 10.5 per cent of the company placed into an employee benefit trust by the BT Pension Scheme.

In a statement, US-based Federated Investors said Hermes’ headquarters, which houses its investment and stewardship teams, would remain in London after the transaction.

J. Christopher Donahue, president and chief executive officer of Federated Investors, said Hermes’ expertise in ESG made it an attractive proposition for the US group.

He said: “As environmental, social and governance considerations play a growing role in investment portfolios, we look forward to bringing Hermes’ ESG integrated investment strategies to US investors, through institutional separate accounts, mutual funds and ESG-related consultancy services.”

Federated Investors managed some £299 billion ($392 billion) of assets as at 31 March 2018, according to the statement.

Saker Nusseibeh, chief executive of Hermes Investment Management, added that the deal would secure Hermes its position as a “truly global” player.

He said: “Today, Hermes joins with Federated to form a truly global asset manage, dedicated to active management, with mutually beneficial distribution capabilities that leverage both Federated’s extensive network of financial intermediaries in the U.S. and Hermes’ fast-growing client base in the U.K, continental Europe and Asia.”