Mitsubishi UFJ Financial Group will pay $425 million for a 15 percent stake in AMP Capital that will enable Japan’s biggest publicly traded bank to take a stake in the world’s fourth-largest pension market.
The deal “does create a significant long-term business opportunity” for AMP, says Stephen Dunne, managing director, AMP Capital Investors.
Dunne says Japanese institutional investors are especially interested in AMP’s property and infrastructure investments. AMP Capital, a unit of AMP Ltd., has about $125 billion assets under management.
Tokyo-based Mitsubishi UFJ retail banking and brokerage businesses will distribute AMP products. Japanese third party distributors and regional banks will do the same. AMP Capital will distribute Mitsubishi UFJ’s investment products..
Mitsubishi UFJ will take one seat on the AMP Capital board. The deal is expected to close by the first quarter next year, says Dunne.
Mitsubishi UFJ’’s Sydney office declined comment.
The deal is the latest in a string of investments made by Mitsubishi UFJ in non-Japanese finance companies over the last three years.
In September 2008 Mitsubishi UFJ provided a US$9 billion lifeline to Morgan Stanley when the New York-based investment bank’s stock price was floundering amid concerns over its business viability. Mitsubishi UFJ had a 22.4 percent stake in Morgan Stanley as of July 1.
In October 2008 Mitsubishi UFJ said they were going to acquire a 9.9 percent stake in Aberdeen Asset Management Plc. and could raise the stake to as much as 19.9 percent.
The Japanese company now has about a 17 percent stake in Aberdeen, says Brett Jollie, managing director of Aberdeen Asset Management Ltd., who describes the relationship between the two companies as “global.”
Australia’s has about $1.4 trillion in retirement assets under management and about $1.8 trillion in total assets under management, according to the Financial Services Council.
Mitsubishi UFJ has about $300 billion in assets under management and about $2.4 trillion in total assets, according to Dunne.