Mercer in Acquisition Deal with Swiss Adviser

Mercer said it has agreed to acquire SCM Strategic Capital Management AG, a Swiss-based specialist private markets adviser and delegated solutions provider.

The transaction is expected to close in the first quarter of 2015. The entire SCM investment team will be joining Mercer, subject to approvals. Stefan Hepp, SCM’s founder and CEO of SCM, will become global business leader of private markets. Ralph Aerni, chief investment officer of SCM, will become global co-CIO of private markets at Mercer alongside Mike Forestner, who is currently director of private markets at Mercer. Hepp and Aerni are slated to join Mercer’s alternatives investment committee. Terms of the transaction were not disclosed.

“Mercer’s investment business has achieved excellent revenue growth and SCM gives us an opportunity to build upon our outstanding global reputation,” Julio A. Portalatin, president and chief executive officer of Mercer, said in a statement. “We are prepared to invest in areas where we see an opportunity to anticipate client needs and to strengthen our advisory and investment management capability.”

According to Phil de Cristo, president of Mercer Investments, the firm’s investment clients are increasingly seeking advice regarding alternatives investment strategy, either through a custom portfolio or a delegated solution. Mercer sees SCM as a valuable addition to its alternatives capabilities, de Cristo said.

“The combination of SCM and Mercer will result in a truly global platform with a substantial increase in manager research and investment management capabilities and will allow us to integrate ESG ratings in the due diligence process,” Hepp said, citing the firms’ similar values and shared commitment to delivering superior insights and solutions in the alternatives market.

As of September 30, 2014, Mercer reported $108 billion in assets under management, including $13 billion in alternative assets under management.