Non-binding agreement outlines Nikko AM’s intention to acquire a minority stake in Osmosis, along with distribution rights, including exclusive distribution rights in AsiaPacific for Osmosis investment products and strategies
Nikko Asset Management Co., Ltd. (“Nikko AM”), a consolidated subsidiary of Sumitomo Mitsui Trust Holdings, Inc. (“SuMiTrust Holdings”) together with Osmosis (Holdings) Limited (“Osmosis”) hereby announce that they have entered into a non-binding agreement for a strategic partnership, under which Nikko AM group intends to acquire a minority stake in Osmosis and to be given distribution rights for Osmosis investment products and strategies.
Osmosis, founded in 2009 and headquartered in London, is a research-based, quantitative investment manager focused on delivering better risk-adjusted investment returns with better environmental outcomes. Its investment philosophy is based on the view that companies that are more resource efficient are more likely to outperform their peers over the long term. The Osmosis portfolios overweight resource efficient companies and underweight, or short, inefficient companies as identified by the Osmosis Model of Resource Efficiency.
Nikko AM, like Osmosis, believes a positive environmental impact should not come at the cost of portfolio performance. Nikko AM group launched Japan’s first SRI fund in 1999, and continues to expand its Global Sustainable Investment Team, with a team hub in Singapore. The firm is also one of the first Asia-based managers to qualify globally as a signatory to the UK Stewardship Code, recognised by many as the highest global standard of stewardship.
|Outline of Distribution Rights for Osmosis Investment Products & Strategies:||Outline of the Investment in Osmosis|
|Both companies have entered into a non-binding agreement for Nikko AM group to gain the exclusive distribution rights in the Asia-Pacific region (excluding Australia) and non-exclusive distribution rights elsewhere for Osmosis investment products and strategies, including its flagship Osmosis Resource Efficient Core Equity Strategy. The approach targets excess returns through the identification of Resource Efficiency in listed companies. Osmosis defines Resource Efficiency as the carbon emitted, waste generated, and water consumed, relative to value creation. Resource efficient companies are, therefore, those that most efficiently use limited resources to create economic value.||Both companies have entered into a non-binding agreement for Nikko AM group to acquire a minority stake in Osmosis.|
Regarding the strategic partnership, Osmosis CEO Ben Dear remarked:
“Osmosis is excited to formalise this partnership with Nikko AM which is based on a shared vision of the scale of the opportunity, an alignment of values, and a belief that the capital markets have a pivotal role to play in directing capital towards those companies that are leading the transition to a more sustainable planet. Through Nikko AM’s established distribution networks, we look forward to raising awareness of our unique investment approach, which targets better risk-adjusted returns while significantly reducing the ownership of carbon, water, and waste, in the Asia region.”
Nikko AM President Stefanie Drews commented: “We are delighted to be able to enter into partnership with a company of such exceptional credentials in the sustainable investment space. Osmosis is truly unique, with an innovative approach that has proven itself over the years. In addition, Osmosis makes for a strong cultural fit, and therefore a perfect partner with whom we look to grow together.”
Summary of Osmosis IM
|Name||Osmosis Investment Management|
|AUM||USD 14 billion*|
Summary of Nikko AM
|Name||Nikko Asset Management Co., Ltd.|
|Executive Chairman||Yutaka Nishida|
|AUM||USD 209.4 billion*|
With US$209.4 billion* under management, Nikko Asset Management is one of Asia’s largest asset managers, providing high-conviction, active fund management across a range of equity, fixed income, multi-asset and alternative strategies. In addition, its complementary range of passive strategies covers more than 20 indices and includes some of Asia’s leading exchange-traded funds (ETFs).
Headquartered in Asia since 1959, Nikko Asset Management and its subsidiaries employ personnel representing around 30 nationalities, including approximately 200 investment professionals**. The firm has a presence through subsidiaries or affiliates in a total of 11 countries and regions. More than 400 banks, brokers, financial advisors and life insurance companies around the world distribute the firm’s products.
The investment teams benefit from a unique global perspective complemented by the firm’s historic Asian DNA, striving to deliver consistent excellence in performance. The firm also prides itself on its progressive, solution-driven approach, which has led to many innovative funds launched for its clients.
For more information about Nikko Asset Management and to access its investment insights, please visit the firm’s homepage.
* Consolidated assets under management and sub-advisory of Nikko Asset Management and its subsidiaries as of 31 March 2023.
** Including employees of Nikko Asset Management and its subsidiaries as of 31 March 2023.
Osmosis launched in 2009 and is majority-owned by management and employees. The company currently manages over $14bn* in sustainable assets and is headquartered in London, with a growing global presence. Osmosis believes that targeting better risk-adjusted returns and delivering significant environmental impact do not need to be mutually exclusive endeavours. Through its unique Model of Resource Efficiency, the company has demonstrated that sustainability metrics, if quantifiable and objective in nature, can be applied to mainstream equity portfolios to generate alpha.
The Osmosis team of quantitative environmental analysts and portfolio managers is singularly focused on delivering three levels of impact. Better risk-adjusted returns, measurable environmental reductions, and an active engagement programme to promote better corporate environmental disclosure.
Osmosis counts Government Pension Funds, State Pension Funds, Insurance Companies, Foundations, Endowments, Family Offices, and Banks amongst their client roster spanning the UK, Europe, the Nordics, North and South America, Asia, and Australia.
*Assets under management and advisory as of 30 June 2023.
Osmosis Investment Management UK Ltd (“OIM UK”) is an affiliate of Osmosis Investment Management US LLC (“OIM US”). Osmosis Investment Management AUM includes discretionary assets under management of OIM US and OIM UK and assets invested in model programs provided by OIM US and OIM UK.