Now that Nelson Peltz has won a surprise bidding war for Janus Henderson Group Plc, the activist investor can start to revamp the $493 billion asset manager he has circled for years.
Peltz is paying about $8 billion, or $52 per share, for Janus Henderson – more than twice where its stock was trading when his Trian Fund Management disclosed its position in late 2020.
At age 83, Peltz – who over the years has famously tangled with corporate giants — is shelling out for what many see as a fixer-upper. Fees are getting squeezed in the age of low-cost index funds, and Janus Henderson’s performance has been mixed since the 2017 merger that created it.
According to people familiar with Peltz’s thinking, Trian intends to use artificial intelligence to streamline Janus Henderson’s business and wring out time-consuming processes.
Central to all of this is Trian’s partner in the deal, General Catalyst, the technology-focused investor that has backed Anthropic, Stripe and defense tech firm Anduril Industries Inc., among others.
General Catalyst has invested billions in AI companies, applications and partnerships. It recently launched a company called Percepta that deploys AI researchers, engineers and product managers across a range of businesses to transform traditional workflows using artificial intelligence. Soon on its to-do list: Janus Henderson.
Percepta, whose founding team included alumni of data-analysis firm Palantir Technologies Inc., will be part of Peltz’s effort to modernize middle- and back-office functions, according to people familiar with the plan.
Janus already uses some AI tools but plans to deploy Percepta’s more-advanced technology to speed up lengthy fund-creation and other processes and meet investors’ growing demands, people familiar with the matter said. Without public shareholders to answer to, Janus will be able to spend big on these new technologies and make hires in other parts of the business.
Representatives for Trian, General Catalyst and Janus Henderson declined to comment.
Peltz has been shaking up Janus Henderson off and on for years now. When Trian began amassing its stake, Janus was bleeding assets and still struggling as a merged firm. Peltz quickly cleaned house, assumed two board seats and pushed for new leadership.
Ali Dibadj took over as chief executive officer in 2022, and Peltz cheered his arrival. The new CEO has managed to win back clients, reverse several years of outflows and heal divisions within the firm, insiders say.
Given Trian’s history with Janus Henderson, the sudden emergence of a rival suitor unsettled some at the company. A relative unknown, Victory Capital Holdings, first approached Janus Henderson’s board in November and then went public with an offer in February. Dibadj and other executives were soon fielding calls from anxious clients, people familiar with the matter said.
Victory, a Texas-based acquisitive mutual fund firm, has a reputation for aggressive cost-cutting and running lean operations, a process Janus Henderson employees were referring to internally as “cost-gutting,” according to the people familiar with the matter. Money managers handling roughly a third of the firm’s assets threatened to quit if Victory won.
Privately, some in the Victory camp claimed they could win over shareholders without Trian’s blessing, separate people familiar with the matter said.
Victory had lined up Wells Fargo & Co. and Royal Bank of Canada to finance its bid, Bloomberg previously reported. But weeks into the public bidding war, RBC had yet to commit the capital for the offer. In a document dated March 17 that was seen by Bloomberg News, the bank said it would offer the credit line only after completing its due diligence.
On March 24, Victory threw in the towel, handing Janus Henderson to Peltz and General Catalyst. Victory did not respond to a request for comment.
Now comes the hard part. Modernizing a money manager with $493 billion of assets, thousands of employees and clunky internal processes won’t be quick or easy. The AI integration at the heart of Peltz’s plan will take time, patience and money.
Peltz has hankered after Janus Henderson for years. Now, it’s his to fix up.
A message from Advisor Perspectives and VettaFi: Discover something new! Click here to register for our upcoming webcasts.
Bloomberg News provided this article. For more articles like this please visit
bloomberg.com.
Read more articles by Loukia Gyftopoulou
