Oddo outlines growth plans after BNY deal

French investment group Oddo & Cie plans to hire new staff and expand beyond its core European markets after acquiring Meriten, the Dusseldorf-based BNY Mellon subsidiary, last week.

Nicolas Chaput, chief executive of Oddo AM, told FTfm that the merger will not result in redundancies for any of the 180 Meriten employees in Dusseldorf or the 108 Oddo investment staff based predominantly in France.

Once the deal has completed the combined asset management group, which will be rebranded as Oddo Meriten Asset Management, will become the eurozone's third-largest independent fund house, with more than €40bn of assets.

Mr Chaput said: "This transaction will be about growth - we are not doing it to reduce costs. We will hire new talent and we want to attract people from any country as long as they are the best.

"Becoming the third most important asset manager in the eurozone will give us more leverage [to hire]. I think we have the right talents today but we will be a new pole of attraction for people as well."

Mr Chaput declined to comment on how many new hires he anticipated but said he is keen to reinforce the group's European equity and asset allocation teams, and improve its relationship with independent financial advisers in Germany.

He added that Oddo, which bought Seydler Bank, the Frankfurt-based investment bank, from Close Brothers in January, is not looking to make further acquisitions, although it would like to expand beyond its core markets of France, Germany, Italy and the Middle East through organic growth. The company is eyeing the UK market in particular.

"We want to make sure the merger works [and] we are not in talks with anyone else. The focus will be on building a single company and culture, delivering top-notch quality to current clients and capturing new ones," the chief executive said.

"Our presence in the UK today is limited and that [market] is something obviously we have in mind. We know the UK is the largest [investment market in Europe] so it is of interest to us, but we need to [prepare] a real value proposition."

Amin Rajan, chief executive of Create Research, an asset management consultancy, expressed doubt over whether the combined group would pose a strong competitive threat to larger asset managers across Europe.

"With minimal overlaps in their product and client bases, this merger between two speciality boutiques makes a lot of sense. Both were caught in the familiar 'mid-tier trap', forcing each to remain sub-scale," he said.

"The combined group will have a broader base of the capabilities that are so essential in the fast-growing area of multi-asset class products, but it is unlikely to make waves. The combined size of the new group will not pack a big punch."

Oddo Asset Management currently ranks 41st out of 150 fund companies in Europe in terms of brand recognition, according to Fund Buyer Focus, an asset management research firm, which interviewed 500 fund selectors such as private banks and platforms to compile the ranking.

Diana Mackay, chief executive of Fund Buyer Focus, said she expected Oddo Meriten to have some success in building its profile across Europe.

"There is no doubt that the French boutiques have been very effective cross-border players. Oddo has a quite a good profile and is a well-recognised boutique [outside of its home market]. The group is not in the top tier but it is certainly there [in terms of brand recognition]," she said.

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