UnionBank of the Philippines (UnionBank) has signed an investment agreement with ATRAM Group, to acquire a 27.5% ownership stake in ATR Asset Management.
Through the proposed deal, the companies’ respective trust subsidiaries, Union Bank Investment Management and Trust (UBIMTC) and ATRAM Trust (ATC) will merge. ATC will emerge as the surviving entity in the merger.
Under the terms of the agreement, UnionBank will acquire around 82.97 million shares of ATR Asset Management at PHP3.61 ($0.062) per share. It will also sell all its 300 million shares of its fully-owned subsidiary, UBIMTC, at PHP1 ($0.017) per share.
UnionBank will pay PHP67.5m ($1.15m) to ATRAM for 25 million common shares in ATR Asset Management and acquire 57.97 million ATR Asset Management shares from the company for PHP232.5m ($3.96m).
Upon the completion of the transaction, shareholders of ATRAM Group will retain the remaining 72.5% stake in ATR Asset Management.
ATRAM CEO Michael Ferrer said: “This merger represents a milestone for ATRAM as we align with UnionBank, a leader in digital innovation. Together, we will change the game and redefine the asset management landscape in the Philippines.
“Our clients will benefit from an expanded suite of investment solutions, enhancing the value and service we deliver.”
By utilising the strengths of both organisations, the proposed transaction aims to establish a robust platform for growth and innovation in the asset and wealth management sector.
Additionally, the merger will establish a key player in the Philippine trust industry, combining the assets under management (AUM) of both firms to total over PHP485bn ($8.26bn).
The combined entity plans to leverage UnionBank’s digital banking expertise with ATRAM’s asset management solutions to deliver a comprehensive suite of financial products to clients.
UnionBank offers digital banking to a client base of more than 15 million and ATRAM has facilitated retail investment access for over two million investors through digital platforms and strategic partnerships.
UnionBank President and CEO Edwin Bautista said: “This partnership allows us to strengthen our offerings and provide even more tailored services to our customers, especially our larger Wealth client base as a result of the acquisition of Citibank Philippines’ consumer banking business.
“We are committed to ensuring they have access to the best financial solutions available while also creating broader career opportunities for our employees in a larger and very dynamic organisation.”
Subject to regulatory approvals, the deal has been structured to ensure a seamless integration that prioritises client service and employee support.
For the transaction, AlphaPrimus Advisors acted as the financial adviser to ATRAM, while Exchange Equity Partners served as the adviser for UnionBank.
