Wealth manager Americana Partners bid $25 a share for Westwood Holdings Group

Westwood Holdings

14/07/2021 14:36

By Svea Herbst-Bayliss
    BOSTON, July 14 (Reuters) - Wealth manager Americana
Partners has made a $25 a share bid for Westwood Holdings Group
 WHG.N , offering a nearly 28% premium to take the publicly
traded financial advisory and mutual fund firm private, sources
familiar with the matter said.
    Americana made the all-cash offer for Westwood, which has
roughly $15 billion in assets under management, last month, the
people said.
    Westwood, valued at roughly $165 million, has not yet
engaged with Americana, one of the sources said. Its stock
closed trading at $19.56 on Tuesday.
    A representative for Americana declined to comment.
    A representative for Westwood did not immediately respond to
a request for comment.
    While Westwood's stock price has climbed some 37% since
January, Americana believes that Westwood, which is
headquartered in Dallas, has produced negative returns over
three- and five-year periods. Americana also believes Westwood
could perform better out of the spotlight of the public markets,
the people said.
    Houston-based Americana wants to expand across Texas and
sees potential in Westwood's wealth and trust businesses, the
sources said.
    The bid was made shortly after Westwood's largest investor,
JCP Investment Management, began pushing management and the
board more publicly to consider alternatives for the firm,
including a sale.
    In a regulatory filing made in April, James C. Pappas, whose
JCP Investment Management owns 10.37% of Westwood, said that he
intended to speak with management and the board about strategic
options.
    A representative for JCP declined to comment.
    A wave of consolidation has hit the asset management and
wealth management industry at a time low interest rates and
investor preferences for inexpensive index funds have made it
tougher for stand alone firms to compete with rivals such as
BlackRock, the world's biggest asset manager.
    Legg Mason was acquired by Franklin Resources last year and
Eaton Vance was purchased by financial services company Morgan
Stanley this year. 
    Last year was a record-setting one for wealth sector deals,
with more than 200 completed, according to research firm Echelon
Partners.
    Americana Partners, which has offices in Houston, Dallas and
Austin, was formed in 2019 when its principals spun off from
Morgan Stanley  MS.N . 
    It has roughly $4.5 billion in assets under management.
    

 (Reporting by Svea Herbst-Bayliss; editing by Jason Neely)
 ((svea.herbst@thomsonreuters.com; +617 856 4331; Reuters
Messaging: svea.herbst.thomsonreuters.com@reuters.net))