A subsidiary of the Metrobank Group has sold all its shares in First Metro Asset Management Inc. (Fami) to a consortium led by the ATR Asset Management (Atram) Group as part of a strategic shift to investment banking.
In a stock exchange filing on Wednesday, First Metro Investment Corp. (FMIC) said it had approved the sale of 1.05 million shares, representing a 70-percent stake, in Fami. It did not disclose the sale price.
According to FMIC, the agreement, which was first reported by InsiderPH, is part of a “strategic business decision to focus on the investment banking business.” Investment banking provides complex financial services, including initial public offerings, to large clients.
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Established in 2013, Fami is the principal distributor and fund manager of First Metro Philippine Equity Exchange Traded Fund Inc., FMIC’s subsidiary that primarily invests in a basket of stocks that represent a specific index, such as the Philippine Stock Exchange Index.
The Atram consortium is composed of parent firm Atram Investment Management Partners Corp. and MET Holdings Inc.
Atram currently has over P385 billion worth of assets under management, ranking fourth among the asset and wealth managers in the country, FMIC said.
In a separate disclosure, Aboitiz-led Union Bank of the Philippines likewise confirmed there were “ongoing discussions between parties” to merge its trust business, UnionBank Trust, with Atram.
InsiderPH reported Atram would be the surviving entity in the deal, which has yet to be finalized, according to UnionBank.
Juan Paolo Colet, managing director at investment bank China Bank Capital Corp., said the deal would allow Atram to quickly scale up its business and increase profitability amid “increasing competition” from larger asset managers and trust entities.
“The nature and economics of the industry favor players who have the scale, talent and efficiency to offer the best products at the least cost, so market consolidation makes sense,” he said.
Asset management firms typically manage specific assets for their clients, including stocks, bonds, real estate, commodities and derivatives.
Trust companies, meanwhile, act as agents or trustees on behalf of a person or company. Some firms offer wealth management services, such as that of UnionBank.