Trian, General Catalyst Scoop Up Janus Henderson for $7.4 Billion

In the asset management world, big fish are eating smaller fish. Sometimes that smaller fish is a very large marlin. Trian Fund Management and General Catalyst agreed yesterday to buy Janus Henderson for $7.4 billion. They’ll pay an 18% premium for Janus’s shares compared to what they were trading at before the deal went public. 

The deal, which is expected to close in the middle of next year, will take Janus, and its $484 billion in managed assets, off the NYSE. Trian and General Catalyst said going private will free the firm “from the constraints of operating as a public company.” Private companies don’t have to report quarterly, a cycle that pressures public firms to please short-term shareholders—sometimes at the cost of long-term goals.

This Didn’t Happen Overnight

The buyout concludes a five-year activist campaign that’s pulled Janus Handerson out of a slump. Some backstory: Janus Capital merged with Henderson Group in 2017, but suffered from outflows and internal conflict after the tie-up. Since October, it’s seen six straight quarters of net inflows. 

Trian, meanwhile, has been building up its stake in Janus over the past five years to 21%, and it has two reps on the company’s board — including its billionaire CEO Nelson Peltz. Now, the firm’s ready to take Janus fully under its wing.

Peltz has been pushing for asset managers, which are struggling with clients switching to cheaper investing products like index funds, to consolidate. He’s not alone:

• Goldman Sachs said in September it’d buy up to $1 billion worth of T. Rowe Price’s shares and collaborate on investment products for retirement savers. T. Rowe’s shares at the time had fallen 50% since their 2021 peak as the firm’s investors pulled out. The deal marks Goldman’s only investment in an asset manager beyond itself. 
• Trian’s deal, which is backed in part by Qatar Investment Authority and Hong Kong-based Sun Hung Kai & Co, also speaks to the increasing involvement of foreign investors in US firms. Aquarian Capital, which is backed by Abu Dhabi, last month made a $4.1 billion deal to take Brighthouse Financial private. 

Better Together: Asset managers have struggled with investors switching to cheaper products and alternative investments. But when firms tie up to combine their assets, they can rack up higher fees and better margins. Peltz has pushed for industry consolidation, and it’s starting to play out.