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September 2, 2022

Sun Life to buy 51% stake in Advisors Asset Management for $214m

Canadian financial services company Sun Life Financial has revealed plans to acquire a 51% stake in US retail distribution firm Advisors Asset Management (AAM).   

The proposed purchase will be made through Sun Life’s asset management business SLC Management for $214m (over C$280m).  

The deal is also expected to give Sun Life a put/call option to buy the remaining 49% stake beginning from 2028.

On completion of the transaction, AAM will serve as SLC Management’s retail distribution arm in US.

In this regard, the insurer plans to set aside $400m to introduce SLC Management alternative products in the US retail market.

The proposed transaction is likely to close in the first half of 2023 subject to receipt of clearance from regulatory authorities.

Under the potential deal, AAM will secure exclusive rights to market SLC Management’s alternative investment products.

Currently, AAM provides solutions and products to support financial advisors at wirehouses, investment advisors as well as independent broker-dealers.

AAM has a team of over 270 employees working in its 10 offices spread across eight US states. As of 31 July this year, the firm managed assets worth $41.4bn. 

SLC Management president Steve Peacher said: “We’ve seen a sustained increase in demand for alternatives from the high-net-worth and ultra-high-net-worth market as they look to add new sources of yield and total return. “We’ve been looking to enter into the retail distribution segment for some time now.

“Adding AAM to our platform allows us to extend our set of world class alternative investment capabilities to new clients and expands the roster of investment solutions that AAM can offer to the US financial advisor market.”

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