Funds run by Barclays, Lindsell Train and Unicorn Asset Management stand to benefit greatly from the sale of UK asset management firm Schroders to US rival Nuveen.
Should the deal be approved, shareholders will receive 612p per share, with 590p paid in cash and 22p coming from dividends. The £5.90 per share offer is equivalent to a 29% increase on Wednesday’s closing price and 42% higher than the three-month average price.
Richard Oldfield, chief executive of Schroders, said: “In a competitive landscape where scale can help deliver benefits, in Nuveen we see a partner that shares our values, respects the culture we have built and will create exciting opportunities for our clients and people.
“The transaction will significantly accelerate our growth plans to create a leading public-to-private platform with enhanced geographic reach and a strengthened balance sheet.”
Four funds and one investment trust have a top 10 position in the stock, according to FE data. FE fundinfo Alpha Manager Nick Train’s Finsbury Growth & Income Trust has the largest position, with a 4.9% weighting to Schroders.
Train was unavailable for comment but pointed to previous commentary from the trust’s end-of-year results in December, in which he said “Schroders is arguably now one of the cheapest assets in the portfolio, trading on a forecast P/E [price-to-earnings] of circa 10x and a dividend yield of 5.5%”.
The bid made by Nuveen values Schroders at 17x last year’s operating profit. Shares in the Finsbury Growth & Income Trust were up 1.2% on the day.
| The funds and trusts with a top 10 position in Schroders | |
| Fund | Weighting to Schroders |
| Finsbury Growth & Income Trust | 4.9% |
| SPDR S&P UK Dividend Aristocrats UCITS ETF | 4.4% |
| Unicorn Outstanding British Companies | 4.3% |
| Barclays GlobalAccess UK Opportunities | 3.4% |
| MI Chelverton UK Opportunities | 3.4% |
Source: FE Analytics
Passive-income investors using the SPDR S&P UK Dividend Aristocrats UCITS ETF for domestic market exposure will also benefit. The fund has a 4.4% weighting to Schroders – the second most on the list.
Unicorn Outstanding British Companies is the only other fund with more than 4% (4.3%) in the stock, while Barclays GlobalAccess UK Opportunities and MI Chelverton UK Opportunities (3.4% each) are the only other portfolios in the Investment Association and Association of Investment Companies universes where Schroders is a top 10 position.
With the board unanimously recommending the transaction, analysts at Jeffries said they believe the deal is likely to proceed, with little potential for a counterbid.
“Put in context, we think this represents an attractive implied takeout valuation for Schroders’ shareholders,” they said.
However, it remains lower than the stock’s all-time share price. Even as shares rose on the announcement to around the bid price (589p), they remain 2% lower over five years and almost 10% lower than the record high of 652p set in September 2021.
The UK market has been viewed as cheap for some time. For example two years ago, Peel Hunt’s head of research Charles Hall warned that the UK small-cap market may cease to exist in a decade if the pace of merger and acquisition activity did not slow.
It is far from a small-cap phenomenon, however. In 2025, 64 companies were bid for, analysis by AJ Bell showed, with an average premium of 39% to the previous day’s share price – more than the offer in Nuveen’s bid for Schroders.
Active managers, in particular, could be vulnerable to further bids. Weak performance among active managers and investors increasingly moving towards passive options have hampered assets under management, profit and growth in recent years.
However, Tim Guinness, founder and chairman of Guinness Global Investors, is not concerned about the industry, noting that takeovers “have been a feature of the investment management industry for as long as I have worked in it”.
The manager of the Guinness Global Money Managers fund – which invests in asset managers exclusively but did not have a position in Schroders at the time of the bid – said the deal does not represent “the first of many” to come in the near future.
He used the example of Save & Prosper, one of the UK’s two biggest fund managers at the time, which was bought by Flemings in 1983 for £1bn in today’s money.
“It’s just part of a story that’s been ongoing forever,” he said.