To satisfy the growing appetite of investors in its home country, Japanese banking giant Mitsubishi UFJ Financial Group is on the prowl to buy a stake in a US fund manager (or managers). Bloomberg reports that president Tatsuo Wakabayashi has said that the bank has up to $1.8 billion to spend over the next three years on managers of a range of asset classes, from mutual funds and fixed-income products to real estate and alternative investments such as hedge funds. It is believed that the company is looking at targets on the East Coast in order to expand its geographic reach.
Stateside, Mitsubishi UFJ is perhaps best known for its nearly 25% stake in Morgan Stanley (it initially paid about $9 billion for a 20% interest in the US investment bank during the credit crisis of 2008). It also owns Union Bank, which is expanding its franchise in California through the proposed acquisition of Pacific Capital Bancorp for more than $1.5 billion. Mitsubishi UFJ already has an agreement with Morgan Stanley in which the US company markets Union Bank asset management products to Morgan Stanley Smith Barney customers.
A US acquisition would represent a continuation of the company’s efforts to build its asset management business beyond its home country. In 2010 it was the first Japanese financial services firm to acquire an interest in a money manager in China when teamed with Hong Kong-based Shenyin & Wanguo Securities to invest some $50 million for an approximately one-third stake in BNP Paribas Asset Management’s business there. Mitsubishi UFJ also holds around 17% of UK-based Aberdeen Asset Management and has a deal in place to acquire 15% of AMP Limited in Australia.