State Street Acquires Part of UK's Gartmore

July 17, 2001 ( - State Street Corp has bought the passive equity arm of UK fund manager Gartmore for an undisclosed amount.

Gartmore’s passive equity business has about $25.33 billion in assets under management, too little to compete with specialist passive managers such as Merrill Lynch, and about 50 institutional clients, which will be transferred to State Street.

Following the sale Gartmore plans to focus on active fund management and will look at expanding through non-organic growth, dependent on US parent company, Nationwide Mutual’s asset management strategy, and will likely seek to grow its hedge fund business.
State Street Global Advisors, the fund management arm of State Street, will see its UK assets under management jump to £41 billion, of which £32 billion will be passively managed.

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Although it plans to grow assets under management in the UK by between 40% and 50% per year, State Street Global Advisors is unlikely to undertake further acquisitions in the UK, according to the group.