Innocap Investment Management has signed a cash-stock deal to take over BNY Mellon’s HedgeMark business.
The deal, whose financial terms were not disclosed, is expected to close in the first half of 2022.
As part of this deal, BNY Mellon will acquire a minority equity holding in Innocap’s combined $50bn global platform.
At closing, the firm will join Innocap reinvesting shareholder Caisse de dépôt et placement du Québec (CDPQ), BNP Paribas and management of Innocap and HedgeMark as shareholders.
The shareholder base will also comprise new institutional investors Fonds de solidarité FTQ and Walter Global Asset Management.
HedgeMark offers a hedge fund managed account platform and risk analytic services.
Following the deal, Innocap will combine its global alternative investment business with HedgeMark to create ‘a single technology-enabled alternative investment platform’.
HedgeMark’s existing leadership will assume senior positions at Innocap.
Innocap president and CEO François Rivard said: “We are excited to welcome HedgeMark employees onboard upon closing. This strong combination will create an agile and scalable industry-leading institutional investment platform.
“Clients will benefit from our combined technological and governance capabilities to serve their stakeholders more effectively.”
BNY Mellon, which held a 35% ownership stake in HedgeMark since 2011, took full control of the business in 2014.
The business has been part of the company’s asset servicing business since then.
Commenting on the latest deal, BNY Mellon global head of Fund Services Alan Flanagan said: “Today’s announcement is yet another example of our commitment to our digital strategy and an open architecture model that allows clients to leverage industry-leading solutions across the fintech ecosystem to address their evolving and increasingly complex needs.”