Over two-thirds of Q3 2009 global asset management M&A activity -- 68% -- represented divestitures, a record level in a three-month period, according to Jefferies. Prominent examples include Bank of America's announced sale of the long-term asset management business of its Columbia Management subsidiary to Ameriprise; Bank of New York Mellon's announced acquisition of Insight Investment Management from Lloyds Banking Group; and the purchase by Sumitomo Trust & Banking of Citigroup's 64% interest in Nikko Asset Management. By contrast, divestitures represented 38% of the total deal volume in the third quarter of 2008. Year-to-date through September 2009, divestitures totaled 57% of asset management transactions, a record for a nine-month period, compared with 32% in the year-earlier period.

˜'As larger financial institutions refocus on strategic strengths, we expect they will continue to separate asset management distribution from manufacturing, keeping the former and seeking solutions for the latter businesses,'' said Aaron Dorr, a New York-based managing director within Jefferies Financial Institutions Group.

Deal volume in the July to September 2009 period totaled 38, compared with 66 announced transactions in the third quarter of 2008. Managed assets transacted rose to $749 billion from $728 billion a year earlier. Disclosed deal value climbed to $4.5 billion from $4.2 billion in the third quarter of 2008, and the median deal value was $140 million, almost twice the median $73 million in the third quarter of 2008.

For the first nine months of 2009, deal volume totaled 113, compared with 174 in the year-earlier period. Approximately $3 trillion in managed assets transacted year-to-date in 2009, against $1.3 trillion in the first nine months of 2008. Disclosed deal value totaled $18.4 billion thus far in 2009, led by the announced sale of Barclays Global Investors to BlackRock for $13.5 billion. In the first nine months of 2008, disclosed deal value totaled $11.9 billion.

While the number of divestitures is on the rise in 2009, transactions involving alternative asset managers declined, along with cross-border deals. Alternative deals represented 24% of the total in the third quarter of 2009, and 25% for the first nine months.