Prudential's $1 Trillion Asset Manager PGIM Working on Deals

(Bloomberg) -- Prudential Financial Inc.’s asset-management unit is on the deal trail.

PGIM is talking to several firms about potential acquisitions, David Hunt, chief executive officer of the business that manages more than $1 trillion, said in an interview in New York. The company is interested in buying bolt-on units that would expand offerings in areas such as private credit, real assets or non-U.S. businesses, rather than large-scale acquisitions, he said.

“We’re definitely in active discussions now,’’ Hunt said. “We’re working on a portfolio of things. I’d be surprised if some of them don’t hit in the next 12 to 18 months.”

Asset managers globally have been eyeing mergers as a way to reduce costs, broaden their product mix and expand geographically as the industry faces pressure on fees. An eventual economic slowdown could trigger more asset-management deals, as disagreements on valuations have so far held back transactions, Hunt said.

“There has not yet been enough of a meeting of minds on price,” Hunt said. “What would change that dynamic? I think the answer to that is a good old-fashioned downturn. And until we get to that, I think we’ll stagger along with a few deals that happen, but not in the magnitude that industry economics should deserve.’’

In November, PGIM announced an acquisition of Wadhwani Asset Management, a quantitative macro investment manager in London.

--With assistance from Lisa Abramowicz and Caroline Hyde.

To contact the reporter on this story: Lananh Nguyen in New York at lnguyen35@bloomberg.net

To contact the editors responsible for this story: Michael J. Moore at mmoore55@bloomberg.net, Josh Friedman

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