IM Square, An innovative European platform dedicated to the development of asset managers

Philippe Couvrecelle, founder of PTH Conseil and former Chairman of the Board at Edmond de Rothschild Asset Management, and his associate Jean Maunoury announce the launch of IM Square, an international platform for the development of entrepreneurial asset management companies. A model that has been tried and tested in the United States for several decades now, but is the first of its kind in Europe.

IM Square is an innovative project in Europe offering a new and complementary approach to asset management by combining financial and industrial partnerships. The objective is to create a virtuous ecosystem bringing together entrepreneurial asset management companies, distributors and global investors. For more than one year of research and analysis mainly in the US, the team of PTH Conseil has identified an investment universe of many tens of asset management companies.

The financial partnership will involve acquiring minority stakes in the capital of entrepreneurial companies wishing to add long-term shareholders -offering an industrial, rather than purely financial approach - to their ownership structure. These “affiliates” will then be held in a holding company, “IM Square Holdings”.

IM Square targets investment companies that are already mature and recognised in their local market, primarily in the US, but also in Europe and in Asia. These companies offer high growth potential with assets under management ranging between $1 and 15 billion. They principally invest in traditional and liquid asset classes: global, US, European and emerging equities, credit, high yield and emerging debt, and balanced and absolute return strategies.

IM Square will support them in their international and institutional development, as well as in the strategic and organisational changes that this can imply, focusing on three key areas: distribution and marketing, organisation and capital transfer, and global expansion.

The co-founders will fund IM Square Holding through a first round of fundraising planned for the end of the year, with a target of 60 to 80 million euros. The first investment is scheduled for the first quarter of 2015. The ultimate aim is to raise 250 million euros to finance a dozen investments and to go public within the next 5 to 7 years.

IM Square intends to bring together shareholders with diverse profiles, from purely financial players such as private equity funds, to “industry” players having access to distribution channels and able to contribute to the distribution of some of the affiliates’ products – private banks, retail banks, family offices, insurance companies and institutional investors.

IM Square has already convinced several European and US investors. In Europe, “La Maison”, the private investors’ club launched recently by Michel Cicurel, and in the US, Rosemont Investment Partners, the Philadelphia-based private equity fund run by Charles Burkhartwhich specialises in buying stakes in American asset managers, have both placed their trust in IM Square.

The other key principle of this project lies within IM Square’s ability to build a high quality portfolio of affiliates. To date, 20 companies (of which 70% are American and 30% European, Asian and Australian) feature in the “pipe-line” of asset managers due to join IM Square’s investment universe.

Philippe Couvrecelle, who has 25 years’ experience in the asset management industry, says:" We have noticed that there are many attractive opportunities for talented entrepreneurial companies that are unsure how to tackle the international market with efficiency. IM Square offers an innovative solution that is respectful of the company’s mind-set, with perfectly aligned interests as a minority shareholder, in order to capture growth wherever it may be”.

Jean Maunoury, who has close to 15 years’ experience in researching and selecting principally US asset managers, adds: “The universe of investment boutiques is incredibly deep in Europe and even more so in the United States. We have estimated that there are over 1,000 companies worldwide that meet our AUM criteria, managing between 1 and 15 billion dollars. And we regularly discover “gems” that are known on their domestic market but have no international visibility – one area where IM Square can offer a vital contribution.”