EFG International is to buy UK-based alternative asset manager Marble Bar Asset Management.

EFG International is to buy UK-based alternative asset manager Marble Bar Asset Management.

EFG International’s sister company, Eurobank EFG, is participating by way of a minority stake of 9.99 per cent. Completion is expected in early 2008, subject to regulatory approvals.

An initial consideration of $517 million in cash will be paid, of which MBAM partners and staff will receive around $400 million, net of tax, to be invested in MBAM’s funds with a staggered lock-up for a period of six years.

Expected future payments are in the range $300 million - $800 million (from the amount due to MBAM partners and staff, 30 per cent is to be invested in EFG International shares), subject to performance over a six year period.

There is also conditional provision for long-term equity incentivisation for key partners, involving an equity stake of up to 20 per cent. The terms of the transaction are in keeping with EFG International’s publicly stated acquisition criteria, in this case a price-earnings ratio of less than 10.

Established in 2002, MBAM has two founding partners - Hilton Nathanson, chief investment officer and Gilad Hayeem, chief executive officer - who are part of a seven-person senior management team and have an investment track record dating back to 1998.

Overall, MBAM has 70 employees, the majority of whom are based in London.

MBAM specialises in long/short equity strategies, serving institutional clients as well as ultra-high-net-worth individuals.

Clients’ assets under management are around $4.4 billion.

Lonnie Howell, chief executive of EFG International said: ”Sheer talent is central to investment management. We are convinced that Marble Bar Asset Management has this, as evidenced by its track record over a number of years, irrespective of market conditions. We feel strongly that they can continue to build on their achievements, and there are tangible areas where we can provide assistance. The addition of Marble Bar is also helpful to us from a number of different perspectives. It brings invaluable intellectual capital and proprietary investment techniques. It also helps us to meet the demand (evident particularly among ultra-high-net-worth individuals) for innovative thinking and value-adding solutions in complex product areas. Central to our role as a private bank is to make sense of an ever changing investment environment for the benefit of our Client Relationship Officers and their clients.”