Another purchase in the field of mutual funds, this time with the smaller companies. Ayalon, which manages NIS 2.8 billion (and another 11.5 billion in “Hosting”), is buying the mutual fund operations of AD Rothschild, which manages NIS 1.1 billion, for millions of NIS (here’s what’s happening in the mutual fund sector). It is not a big deal like last year’s purchase of Hellman Eldoubi by the Phoenix for NIS 275 million, and the market estimates the purchase at NIS 10-20 million, since the Phoenix deal to purchase Alomat’s operations almost 3 years ago was made for 35 million NIS, when Alomat managed 5 A billion shekels.
In a conversation with BizPortal Noam Braverman, CEO of Ayalon Investment House, estimator That the declines in the markets are close to ending: “The market will go up when the issue of the interest rate increase exhausts itself or, alternatively, that the interest rate will start to fall. We estimate that this will happen in 2023, and the market that looks at and directs future things will give its signals and have a more positive direction for us next year. Sometime in 2023 The story will calm down, if there are no new surprises.”
Why are you purchasing Rothschild?
Braverman: “It’s hard to survive if you’re small. The market is going through very challenging days right now. It’s not new that size has an advantage. For him, the transaction is a leap forward, and will put us in a good place in the ‘Big 10’ of fund companies.
“Rothschild and I had the opportunity to talk and we reached a good deal for all parties. We are purchasing it as part of our business thinking. We want to grow naturally and also through acquisitions, there was an opportunity and we made the purchase.
Will you make more purchases?
Braverman: “In principle, we want to buy activities, both in mutual funds and in portfolio management. If you hear about additional transactions, we would be happy to hear.
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“The goal is to both bring new products and buy activities and grow in portfolio management, but we will continue to be a boutique investment house.”
Is the purchase being made because of the outflow of funds this year from traditional funds and the transition to financial funds?
Braverman: “It has nothing to do with what went in and out this year. There are years when they raise money and there are years when they sell money. At the moment it is true that there is hype on the issue of financial funds because of the attractiveness of interest rates (following the increase in interest rates), but inflation is starting to calm down in Europe (according to the data published today in the Eurozone Inflation drops to 10%, compared to 10.6%. NA), and we see this in the US as well, but we believe that when there is a relaxation in inflation and also the interest rate will rise less or even stop, it will be good for the traditional industry.
“Mutual funds are money that comes for a short time. When the markets see the direction, the funds will come back to the mutual funds – for involvement, corporations and equities. The interest rate gave a negative ‘push’ to the sector and we believe that when it calms down, the funds will return to the more aggressive funds.”
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