Uh Oh! So far bids for Bank of America Corp.'s (NYSE:BAC) Columbia Management are lower than expected.
The Charlotte, N.C.-based bank was hoping to score at least $3 billion from the sale of its investment management unit, but the
Financial Times is reporting that bids are coming in closer to $2 billion.
According to the report, the unit's bids are ringing in lower because the leading bidder BlackRock Inc. (NYSE:BLK) is now out of the auction since scooping up Barclays Global Investor for $13.5 billion last month instead. Now, BofA is scrambling to find interested bidders. It is even considering
selling the unit in pieces because bidders such as Federated Investors might be interested in picking up parts of the unit for a higher price, according to the FT. Other potential bidders for the unit include Invesco, Oppenheimer and Franklin Resources Inc. (NYSE:BEN). PE firms reportedly were shut out of the bidding.
Columbia Management isn't the only asset management business up for sale, AIG's asset management
is also attracting bidders. A consortium led by Franklin Resources that includes Temasek Holdings Pte. Ltd. of Singapore and Richard Li's Pacific
Century Group are
rumored to be finalizing a deal to buy AIG's asset management unit, AIG
Investments. The insurer is hoping to get $500 million for
the asset. (The Deal Pipeline subscribers can read more
here.)
Even though bidding for Columbia is apparently tepid, the FT reports that bidding for BofA's private bank First Republic Bank is hot. Apparently, several PE firms could make a club bid for it. The group is led by Gerry Ford and includes Carlyle Group, Blackstone Group LP (NYSE:BX), Oak Hill Capital Partners and TPG Capital. The San Francisco-based bank could
command a price of $700 million, David Hendler, an analyst with
Creditsights Inc., said in a June 8 report, according to
Bloomberg.
- Maria Woehr
Also see: First Republic next on LBO list of bank buys? Buyout shops join auction for AIG's Nan Shan
.
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good article, except for the uh oh opening grow up will ya