United Asset Management
Encyclopedia
United Asset Management was an American holding company
headquartered in Boston, Massachusetts that owned a number of financial-sector companies. It was founded in 1980 by Norton Reamer, who previously had served as the CEO of Putnam Investments
. The company was the first major firm with a business model that consisted of purchasing a number of money management firms.
UAM's strategy was to purchase a variety of investment management firms, and then keep a portion of the firms' profits. They allowed each company to operate autonomously and did not close poorly-performing units. More than half of UAM's assets were retirement funds. They used stock and cash to fund its acquisitions. They used First Boston
as an investment bank to raise money for takeovers, using equity rather than convertible bond
s. Some investors viewed the idea of purchasing stock in UAM as akin to an option
on the New York Stock Exchange
, where it was listed in 1987.
In 2000, UAM was purchased by Old Mutual
for US$1.46 billion in cash. Old Mutual also assumed UAM net debt of around US$769 million. The company was then renamed Old Mutual Asset Management US.
Holding company
A holding company is a company or firm that owns other companies' outstanding stock. It usually refers to a company which does not produce goods or services itself; rather, its purpose is to own shares of other companies. Holding companies allow the reduction of risk for the owners and can allow...
headquartered in Boston, Massachusetts that owned a number of financial-sector companies. It was founded in 1980 by Norton Reamer, who previously had served as the CEO of Putnam Investments
Putnam Investments
Putnam Investments is a privately owned investment management firm founded in 1937 by George Putnam, who established one of the first balanced mutual funds, The George Putnam Fund of Boston...
. The company was the first major firm with a business model that consisted of purchasing a number of money management firms.
UAM's strategy was to purchase a variety of investment management firms, and then keep a portion of the firms' profits. They allowed each company to operate autonomously and did not close poorly-performing units. More than half of UAM's assets were retirement funds. They used stock and cash to fund its acquisitions. They used First Boston
First Boston
First Boston Corporation was a New York-based, bulge bracket, investment bank, founded in 1932 and acquired by Credit Suisse in 1990. Together with its sister investment banks, it was referred to as CS First Boston after 1993 and part of Credit Suisse First Boston after 1996, the First Boston part...
as an investment bank to raise money for takeovers, using equity rather than convertible bond
Convertible bond
In finance, a convertible note is a type of bond that the holder can convert into shares of common stock in the issuing company or cash of equal value, at an agreed-upon price. It is a hybrid security with debt- and equity-like features...
s. Some investors viewed the idea of purchasing stock in UAM as akin to an option
Option (finance)
In finance, an option is a derivative financial instrument that specifies a contract between two parties for a future transaction on an asset at a reference price. The buyer of the option gains the right, but not the obligation, to engage in that transaction, while the seller incurs the...
on the New York Stock Exchange
New York Stock Exchange
The New York Stock Exchange is a stock exchange located at 11 Wall Street in Lower Manhattan, New York City, USA. It is by far the world's largest stock exchange by market capitalization of its listed companies at 13.39 trillion as of Dec 2010...
, where it was listed in 1987.
In 2000, UAM was purchased by Old Mutual
Old Mutual
Old Mutual plc is an international long-term savings group. Established in 1845 in South Africa, it is now a FTSE100 listed company operating in 33 countries.-History:...
for US$1.46 billion in cash. Old Mutual also assumed UAM net debt of around US$769 million. The company was then renamed Old Mutual Asset Management US.