Man Group

Man Group plc
Public
Traded as LSE: EMG
Industry Financial services
Founded 1783 (1783)
Founder James Man
Headquarters Riverbank House
2 Swan Lane
London
United Kingdom
Area served
 Worldwide
Key people
Products Investment products
Revenue US$1,068 million (2017)[2]
US$272 million (2017)[2]
US255 million (2017)[2]
Number of employees
 1,325 (2017)[2]
Divisions
Website Man.com

Man Group plc is an active management business[3] initially founded as a sugar cooperage and brokerage by James Man in 1783. It provides a range of funds for institutional and private investors globally and is the world's largest publicly traded hedge fund company, reporting $103.5 billion in funds under management as of September 2017.[4] The firm is headquartered at Riverbank House in London and employs over 1,000 people in various locations worldwide.[5] The company is a sponsor of the arts and charitable initiatives, including the Man Booker Prize.[6]

History

The company was founded by James Man in 1783 as a sugar cooperage and brokerage, based in Harp Lane in Billingsgate. The following year Man Group won the contract to supply the Royal Navy with the rum for its daily "rum tot", a tradition under which all sailors were allocated a daily rum ration. This tradition continued until 1970, with Man Group holding the contract throughout.[7] The company further expanded from sugar and rum into other commodities such as coffee and cocoa. The company traded as a commodities business throughout the 19th and 20th century, gradually diversifying into financial services following the advent of financial exchanges to hedge commodity exposures.[7]

The firm was renamed ED & F Man in 1869, based on the initials of James Man's grandsons Edward Desborough Man and Fredrick Man. ED & F Man listed on the London Stock Exchange in 1994. In 2000 the company divided into two entirely separate businesses, with Man Group plc focusing exclusively on financial services and ED & F Man (the commodities division) taken private in a management buy-out.[8]

In 2007 Man Group moved into its present form as an investment management business, following the demerger and flotation of its brokerage business (known as MF Global) on the New York Stock Exchange.[9] Man Group attained its current structure over time through acquisition. Man AHL is the oldest investment manager of the group, having been acquired over time from 1989 to 1994. Man Group's other investment managers were formed via acquisition between 2010 and 2017, beginning with the 2010 acquisition of Man GLG (previously GLG Partners) for $1.6 billion,[10] followed by Man FRM in 2012,[11] Man Numeric in 2014 and Man GPM in 2017.[12]

In late 2017, the group announced the creation of a quantitative hedge fund in China. The firm has held licences to operate in the country since 2012, but has more recently been provided clearance to operate as a private securities investment fund manager: Man is one of the first global firms to receive this accreditation. The fund will be managed by Man's AHL division.[13]

Structure and operations

Man Group head office at Swan Lane in London (building in the background)

Man Group offers strategies across a variety of investment approaches, styles and asset classes:[14]

Man AHL

Founded in 1987, Man AHL is a diversified quantitative investment manager offering absolute return and long-only funds, with both momentum and non-momentum strategies.[15]

Man Numeric

Man Numeric was established in 1989 and acquired by Man Group in 2014. A Boston-based quantitative asset manager, Man Numeric offers long-only, active extension and hedged equity strategies. Man Group acquired Man Numeric to build a diversified quantitative fund management business in non-momentum strategies, and to develop Man Group's presence in the North American market.[16]

Man GLG

Man GLG was established in London in 1995 as GLG Partners. It was publicly listed in 2007 before being acquired by Man Group in 2010 for $1.6 billion. Man GLG is a multi-team discretionary investment manager. Man GLG utilises absolute return and long-only strategies across asset classes, sectors and geographies. The January 2015 acquisition of Silvermine was expected to boost the division's US CLO business.[17]

Man FRM

Established in 1991, and acquired by Man Group in 2012, Man FRM's 58 research and investment professionals operate from London, New York, Tokyo, Guernsey and Pfäffikon (SZ), Switzerland.[18]

Man GPM

Man Global Private Markets Group (Man GPM) launched in 2017, with the completed acquisition of Aalto Invest Holding AG, a real estate investment management company with $1.7bn in assets under management at the time.[19]

Strategy

Luke Ellis was appointed as Man Group's CEO in September 2016.[20] He succeeded Manny Roman, whom Ellis had worked with for seven years at Man Group and had known for two decades. Ellis' strategic objective for Man Group is to continue diversifying the firm through acquisition, as well as invest in its infrastructure.[21] Man Group has seen significant cost-cutting, led by Co-President Jonathan Sorrell, with a $270 million cost-saving programme planned for delivery in 2015 achieved ahead of schedule.[22][23][24] Sorrell's role as President was expanded by Ellis to include corporate strategy, private markets and acquisitions.[25]

The Group is likely to be affected by changes to the Markets in Financial Instruments Directive 2004, known as "MiFID II", which go into force in early 2018. This regulation changes the way in which companies like Man pass on costs to their investment clients, such as brokerage and research, which has caused controversy in recent years. The Group announced a U-turn in October 2017 clarifying that it would not pass on research costs to clients as specified by MiFID II, which was likely to impact pre-tax profits by $10–15 million in 2018.[26]

Mergers and acquisitions

RMF and Bernard Madoff

RMF, a former division of Man Group, invested 0.5% of its funds under management at the time with various 3rd party funds which, in turn, had positions in funds ultimately managed by Bernard Madoff. RMF was one of 107 financial institutions and 13,000 individuals to invest in such funds. As of 2014, 59% of all such funds have been recovered and returned to various institutions and individuals.[44]

Man Booker Prizes

Man Group has sponsored The Man Booker literary prize since 2002.[45] Described by The Telegraph as "...arguably the UK's most prestigious" literary prize, the £50,000 award was created in 1973 to increase the reading of quality fiction and attract "the intelligent general audience".[46][47] Each year the winner is announced at an awards dinner broadcast live by BBC Television. Inclusion into the award's shortlist and attendant press coverage is known to provide a significant boost to book sales and bookstore visits, with sales trebling in some cases.[48]

The 2017 prize was awarded to the American writer George Saunders, for Lincoln in the Bardo.[49] Previous winners include Philip Roth and Lydia Davis.[47] The 2014 award went to author Richard Flanagan for The Narrow Road to the Deep North, with his prize presented by Chair of judges AC Grayling at London's Guildhall. It was the first year in which eligibility for the award was expanded to include any novel written in English and published in the UK.[50] Man also sponsors the Man Booker International Prize. This £50,000 prize is awarded each year on the basis of a single book translated into English, and aims to encourage the publishing and reading of quality fiction in translation. The prize is divided equally between author and translator.[51]

Corporate responsibility

Man Group supports various charitable initiatives, principally through the Man Charitable Trust and the Oxford-Man Institute:

Man Charitable Trust

Set up in 1978, The Man Charitable Trust is an independent registered charity that funds small to medium-size charities focusing on literacy and numeracy programmes. It also funds programmes in support of access to education for disadvantaged people. In 2014 the trust awarded £427,075 to UK charities, including £50,000 to Beanstalk, a charity that recruits and trains volunteers to provide reading support in primary schools, and £50,000 to National Numeracy, a charity dedicated to raising low levels of numeracy among adults and children.[52][53]

Oxford-Man Institute

In June 2007 Man launched a joint project with the University of Oxford, the Oxford-Man Institute of Quantitative Finance. Man Group's initial financial commitment to the Institute was £13.75 million, one of the largest single donations to a British higher education institution in recent years.[54] In 2016 the Oxford-Man Institute expanded its focus on machine learning and data analytics, becoming part of the University of Oxford's Department of Engineering Science. The development of the OMI's focus creates a hub for machine learning and data analysis at Eagle House, the current home of the OMI and Man AHL's Oxford Research lab.[55]

Former sponsorships and charitable initiatives

Man Group is a former sponsor of the Man Group International Climate Change Award and the Man Asian Literary Prize.[56][57] In the 1990s, Man was a founding member of the East London Partnership, which became the East London Business Alliance, a business-community outreach charity promoting corporate social responsibility and employee volunteering.[58]

See also

References

  1. ↑ Fortado, Lindsay. "Pierre Lagrange to take on senior advisory role at Man Group". FT.com. Nikkei. Retrieved 19 December 2016.
  2. 1 2 3 4 "Annual Report 2017". Man Group. Retrieved 26 March 2018.
  3. ↑ "Man Group boss confident that performance will pick up". Financial Times. Retrieved 2017-10-30.
  4. ↑ Calatayud, Adria. "Man Group's assets under management rise 8%". MarketWatch. Retrieved 2017-10-31.
  5. ↑ Global 50 Funds of Hedge Funds, The Hedgefund Journal, June 2009.
  6. ↑ Sutherland, John (9 October 2008). "The Booker's Big Bang". New Statesman. Retrieved 3 September 2009.
  7. 1 2 "Man Group: Timeline" (PDF). Archived from the original (PDF) on 16 February 2011. Retrieved 18 April 2011.
  8. ↑ "Corigins". strauscom.com. Retrieved 30 March 2015.
  9. ↑ Man Group's MF Global unit files for IPO Reuters, 1 June 2007
  10. 1 2 Man agrees takeover of GLG FT, 17 May 2010
  11. 1 2 Man Group to acquire rival FRM FT, 21 May 2012
  12. 1 2 Man Group's flagship funds stage continued recovery Financial Times, 8 September 2014
  13. ↑ Man Group to launch quant hedge fund in China Financial Times, December 2017
  14. ↑ "Our offering". Man Group. Retrieved 22 April 2017.
  15. ↑ "Quant hedge fund of the year: Man AHL". Risk.net. Retrieved 26 March 2018.
  16. ↑ "Man Group to Buy Numeric Holdings of Boston". Deal Book. 19 June 2014. Retrieved 27 March 2018.
  17. ↑ Miles Johnson (17 December 2014). "Man Group buys Silvermine for $23.5m". Ft.com. FT.com. Retrieved 14 July 2015.
  18. ↑ "Man Group to Buy FRM Holdings for Up to $83 Million". NYTimes.com. New York Times. Missing or empty |url= (help)
  19. ↑ Khan, Mehreen. "Man Group completes deal for property manager Aalto Invest". Financial Times. Retrieved 2017-10-30.
  20. ↑ Eschenbacher, Stefanie. "Luke Ellis, the New Man in Charge at Man Group". WSJ.com. Dow Jones. Retrieved 10 November 2016.
  21. ↑ "Luke Ellis to succeed PIMCO-bound Manny Roman as Man Group CEO". HedgeWeek.com. GFM Ltd. Retrieved 10 November 2016.
  22. ↑ "Man Group steps up search for deal to diversify business". 19 February 2014. Retrieved 5 July 2014.
  23. ↑ "Manny's Roman empire taking shape".
  24. ↑ Lindsay Fortado, Hedge Fund Correspondent (June 5, 2016). "Man Group promotes CFO Jonathan Sorrell to co-president". Financial Times. Retrieved June 15, 2016.
  25. ↑ Dakers, Marion. "New boss of Man Group shuffles top staff". Telegraph.co.uk. The Telegraph newspaper group. Retrieved 10 November 2016.
  26. ↑ Man Group reverses Mifid II research decision, https://www.fnlondon.com/articles/man-group-reverses-mifid-ii-research-decision-20171013
  27. ↑ Man Is Feeling The Pull Of Gravity Business Week, 1 November 2004
  28. ↑ ED&F Man Group PLC acquires Glenwood Capital Investements Thomson, 10 November 2000
  29. ↑ Man Group buys Australian hedge fund group Financial News
  30. ↑ Man Group PLC acquires RMF Investment Group Thomson, 31 May 2002
  31. ↑ Man Group PLC acquires a minority stake in BlueCrest Capital Management Thomson, 31 December 2003
  32. ↑ Jones, Sam (23 March 2011). "Man Group sells BlueCrest stake". FT.com. Pearson. Retrieved 16 July 2015.
  33. ↑ Man Group sets sail with Pemba into credit Hedge Funds Review, April 2007
  34. ↑ Man Group PLC acquires Ore Hill Partners LLC (pending) Thomson, 31 March 2008
  35. ↑ Man ECO announces $635 million raised for China Methane Recovery Fund CPI Financial, 10 April 2008
  36. ↑ Man Group PLC acquires a minority stake in Nephila Capital Ltd Thomson, 6 June 2008
  37. ↑ Acquisition of FRM Holdings Limited by Man Group Archived 7 July 2014 at the Wayback Machine. maninvestments.com.au, 17 July 2012
  38. ↑ "Man Group closes Pine Grove Asset Management acquisition". Hedgeweek.com. Hedgeweek. Retrieved 20 July 2015.
  39. ↑ Man Group Buys Merrill Lynch's $1.2 Billion Funds of Hedge Funds Bloomberg, 8 December 2014
  40. 1 2 3 "Man Group trading statement - March 2015". Man.com. Man Group. Retrieved 20 July 2015.
  41. ↑ Man Group to Acquire Silvermine Capital Management Bloomberg, 19 December 2014
  42. ↑ Man Group to buy asset manager NewSmith Financial Times, 20 February 2015
  43. ↑ Man Group acquires Aalto to launch private markets arm Investment Week, 14 October 2016
  44. ↑ Larson, Erik (8 January 2014). "Madoff Trustee Tops $10 Billion Recovery With Bank Deal". Bloomberg.com. Retrieved 14 July 2015.
  45. ↑ "The Man Booker Prize". The Man Booker Prize. Retrieved 18 April 2011.
  46. ↑ Stock, Jon; Rigden, Kealey (15 October 2013). "Top 25 Literary Prizes". Telegraph.co.uk. London. Retrieved 17 June 2015.
  47. 1 2 "The Prizes". Man Booker. Archived from the original on 18 June 2015. Retrieved 17 June 2015.
  48. ↑ "Bookser sales boost down". TheBookseller.com. The Bookseller. Retrieved 17 June 2015.
  49. ↑ "Booker winner took 20 years to write". BBC News. 2017-10-18. Retrieved 2017-10-31.
  50. ↑ "Richard Flanagan wins Man Booker prize with 'timeless depiction of war'". TheGuardian.com. Guardian Media Trust. Retrieved 14 July 2015.
  51. ↑ "The Man Booker International Prize 2018 Rules" (PDF). themanbookerprize.com.
  52. ↑ "Our Supporters". Beanstalk. Archived from the original on 20 July 2014. Retrieved 14 July 2015.
  53. ↑ "Count Me In: Improving numeracy in England - A guide for charities and funders" (PDF). NationalNumeracy.org. National Numeracy. Retrieved 14 July 2015.
  54. ↑ Oxford-Man Institute of Quantitative Finance officially opened University of Oxford, 19 September 2007
  55. ↑ "Areas of research". Oxford-man.ox.ac.uk. Oxford Man Institute. Retrieved 17 June 2015.
  56. ↑ MALP News. "Man Asian Literary Prize". Man Asian Literary Prize. Retrieved 18 April 2011.
  57. ↑ Allen, Katie (18 October 2012). "Asian Literary Prize seeks new sponsor". The Bookseller. Retrieved 19 November 2012.
  58. ↑ Ball, Stephen J; Junemann, Carolina (2012). Networks, New Governance and Education. p. 89: 'And Man was a founding member of what was called East London Partnership, which became East London Business Alliance, a business-community outreach charity promoting corporate social responsibility (CSR) and employee volunteering. Retrieved 1 September 2014.

Further reading

  • Jenkins, Alan C., 1989, The House of Man, London, UK: Rainbird Publishing. ISBN 0-09-995370-6
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