Oct 30, 2020 - Economy & Business
Ares Management in talks to buy Australian investment firm AMP
Ares Management is in early talks to buy listed Australian wealth management and investment firm AMP.
Why it matters: This would be an ignominious end to the 171-year firm's independence, as a series of scandals has cut its stock price by more than 70% since mid-2018.
- AMP's bad behavior has included lying to regulators, charging customers for services not rendered, mishandling sexual harassment claims, and even deducting life insurance premiums from the accounts of dead clients.
The state of play: AMP shares jumped around 20% on the news, bringing its market cap to nearly $5.3 billion.
The bottom line: "Suppose the retail-focused wealth management business and bank turn out to be duds. Ares is still picking up a global infrastructure investor (AMP Capital) on the cheap, at a time when the prospects for such businesses look rosy," per Bloomberg.