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Nomura has agreed to buy Macquarie’s US and European public asset management business as it expands globally and takes advantage of a generational shift in Japanese investment habits.
The $1.8bn all-cash deal, which is expected to close by the end of the year, is Nomura’s biggest international expansion since 2008 when it bought the Asian and European assets of then imploding Lehman Brothers.
The acquisition will entail Nomura buying a business with about $180bn in assets under management across equities, fixed income and multi-asset strategies. It will expand Nomura’s investment management division to roughly $770bn, with more than 35 per cent being managed on behalf of clients outside Japan.
Kentaro Okuda, Nomura’s chief executive, has made it his mission since taking over in 2020 to shift the group towards wealth and asset management.
“The addition of this business to our group will give us a solid platform in the high-growth US market, which has the largest fee pool in the asset management and the financial industry. We are confident that this will be a significant boost to the group’s future growth,” he said on Tuesday.
Okuda said after the deal the investment management business would derive about 60 per cent of its revenues from outside Japan, compared with about 30 per cent today. “The company will evolve into a global platform,” he added.
Nomura is trying to reduce its reliance on volatile revenue streams from trading and investment banking. The need to diversify was underlined after group took a $2.9bn hit from the collapse of Archegos in 2021.
This strategy is designed to pursue international growth and to capitalise on the opportunity Nomura expects as inflation returns to Japan, encouraging households to transfer wealth from cash and deposits into higher-yielding investments.
Japanese households hold about half of their total ¥2.2 quadrillion ($15.4tn) of financial assets as cash and deposits, according to the Bank of Japan.
Nomura’s Christopher Willcox, who oversees the investment management division, said that he had scrutinised “in detail . . . at least” 20 targets over the past two years.
He said Macquarie’s was a platform that “ticked a lot of boxes for us”, including widespread distribution and the potential to “plug in” further smaller acquisitions.
The Lehman acquisition in 2008 was also a bold attempt to catapult Nomura into the ranks of global investment banking. However it was dogged by poor profitability and culture clashes, with chunks of the business shut down later.
For Macquarie, the sale represents the most significant step in the Sydney-based asset manager’s pivot towards private markets outside Australia.
It built its international asset management business after acquiring US company Delaware Investments in 2010 for $428mn, then one of its largest acquisitions, and has grown the Philadelphia-based business with further deals since. It bought Waddell & Reed for $1.7bn in 2021.
Thomas Strong, an analyst with Citi, said that the disposal “sharpens the focus” of Macquarie’s core asset management arm. He said fees had come under pressure since the Waddell & Read acquisition, which the Australian group had not been able to offset by expanding its international business.
Nomura’s earnings have started to improve under Okuda, including doubling from a year earlier in the three months to December. However, the bank and brokerage’s share price is down close to 25 per cent since its highest point this year, mirroring steep moves across Japanese financial groups in the wake of US President Donald Trump’s tariffs.
Nomura is due to announce its full-year results on Friday.
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