Bridgepoint cautions on fund firm deal prices

By Laurence Fletcher

LONDON (Reuters) - A senior figure at private equity firm Bridgepoint Capital has expressed concern about the prices of deals in the fund management sector, following a number of high-profile management buyouts.

William Jackson, managing partner at Bridgepoint, told the Reuters Hedge Fund and Private Equity Summit on Thursday that the firm, which sold its interest in wealth manager Tilney Investment Management last year, was unlikely to invest in the fund management sector at present.

"It's a cyclical business. You have to ask whether now is the right time to be buying into new fund management businesses given where prices are," he said.

"I think it's unlikely we'd want to buy now."

Last month British fund manager Jupiter Asset Management was bought by private equity group TA Associates and senior Jupiter management for more than 1 billion euros ($1.35 billion).

Gartmore, another well-known retail fund management name, was bought by Hellman & Friedman Advisors and Gartmore management last year.

"For stockbrokers or fund management firms, when a market downturn happens it will hit revenue lines. If the market falls by 25 percent it gives a 25 percent decline in revenues," Jackson said.

"I (also) suspect the market opportunity has gone, as it's now been consolidated by the big guys."  Continued...