Warburg Pincus sells Source to Invesco

Financial details of the transaction remain undisclosed, though the Financial Times reported in October that the vendor was aiming for a sale price of $400-500m.

The divestment comes three years after Warburg Pincus acquired the company with capital drawn from Warburg Pincus Private Equity XI, an $11.2bn vehicle that held its final close in May 2013.

The deal comprises $18bn of assets under management directly managed by Source and $7bn in externally managed assets. It forms part of Invesco's plans to expand its investment product portfolio in Europe, the Middle East and Africa.

Under Warburg Pincus's tenure, the company has expanded its international presence, opening a Zurich office in 2015 in order to increase its proximity to key clients. It has also undertaken a marketing campaign alongside brand consultancy EatBigFish.

The deal is expected to complete in Q3 of 2017, subject to regulatory approval.

Previous funding
In January 2014, Warburg Pincus acquired a majority stake in Source from a consortium of vendors including Bank of America Merrill Lynch, Goldman Sachs, JP Morgan, Morgan Stanley and Nomura. The consortium retained a minority stake in the business as part of the deal.

Company
Established in April 2009 and based in London, Source is an asset manager providing equity, fixed-income, commodity and alternative market exposure through exchange traded funds and exchange traded commodities.

The business generated an operating loss of £20.5m in 2015, according to publicly available documents, on turnover of £16.8m.

People
Warburg Pincus – Cary Davis (managing director).
Invesco – Andrew R Schlossberg (senior managing director, head of EMEA).
Source – Mike Paul (executive chairperson).

Advisers
Company – JP Morgan (corporate finance).

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