Partnerships between traditional and alternative asset managers targeting the wealth channel have become all the rage, and Invesco and Barings are the latest to announce an initiative.
In this case, Invesco and Barings are leveraging a tied connection to MassMutual. Barings is MassMutual’s $442 billion asset management subsidiary. Meanwhile, in concert with announcing the partnership, MassMutual and Invesco announced an agreement under which Invesco would repurchase $1 billion of MassMutual’s $4 billion of outstanding Invesco, Ltd Series A Preferred Stock.
The partnership between the firms will start with a focus on private credit but will also seek to build on the firm’s fixed-income practices and “Barings’ and Invesco’s expertise creating unique products for complex institutional portfolios.”
Over the longer term, the firms said the partnership will move across the multi-strategy credit spectrum and across a wide range of investment vehicles.
MassMutual intends to support this initiative with $650 million initially to accelerate its growth and scale.
“We believe our complementary capabilities will create a formidable combination helping us deliver unique income solutions for the U.S. wealth segment, and we look forward to continuing to find unique combinations and partners that allow us to address needs of our clients across all segments and market cycles,” Andrew Schlossberg, president and CEO of Invesco, said in a statement.
“With the majority of our platform spanning alternative assets, scaling those capabilities in the U.S. wealth market continues to be a long-term growth objective for Barings,” Mike Freno, chairman and CEO of Barings, said in a statement. “We are excited to partner with Invesco to expand wealth investors’ access to private markets by leveraging our long history of delivering solutions to institutional investors.”
The repurchase agreement between Invesco and MassMutual includes provisions for potential future repurchases of the remaining $3 billion of outstanding preferred stock. MassMutual remains a “significant Invesco shareholder” with approximately 18.2% ownership of common shares outstanding and is a longstanding strategic partner to Invesco with previous seed and co-investment capital commitments exceeding $3 billion in total and approximately $9 billion of Invesco-managed assets sold through MassMutual’s broker/dealer, variable annuity and sub-advisory platforms.
Other private markets partnerships between asset managers eying the wealth sector announced in the past year include ones between KKR and Capital Group, BlackRock and Partners Group, Apollo and State Street, Blackstone, Wellington and Vanguard.
The announced partnerships have generally centered around evergreen vehicles, model portfolios or separately-managed accounts.