Frendegruppen – Norway’s second-largest banking partnership – announced about a year ago its agreement to acquire a majority stake in the Norwegian fund boutique Borea Asset Management. Frende Kapitalforvaltning, a subsidiary of Frendegruppen, acquired the 70 percent stake in the boutique for NOK 303.6 million, according to AMWatch. This transaction values Borea Asset Management at approximately NOK 433 million, or €37.5 million.

Frende Kapitalforvaltning’s acquisition of a 70 percent stake in Borea Asset Management offers a useful benchmark for the valuation of Nordic boutique fund managers. The implied valuation of NOK 433 million corresponds to approximately 13.6 times Borea’s net earnings for 2023, or around 10.7 times its earnings before interest and taxes (EBIT) for the same year. 

“It’s a good deal. The company is already generating good earnings, and it will continue to build on its focus on private customers,” says Jan Erik Kjerpeseth, CEO of Sparebanken Norge – one of the member banks in Frendegruppen. “We’re paying for a foundation that would have cost us significantly if we had to build it ourselves. Strategically, we see this as an important purchase with an infrastructure that we can build on,” according to Kjerpeseth.

“It’s a good deal. The company is already generating good earnings, and it will continue to build on its focus on private customers.”

Jan Erik Kjerpeseth, CEO of Sparebanken Norge.

Established in 2005, Borea Asset Management has focused on managing capital for professional investors, primarily through special funds with higher minimum investment requirements. As part of the acquisition, the firm has already begun expanding its product range to serve the broader retail market, aiming to reach the 800,000 to 1 million customers served by the consortium of independent banks within Frendegruppen.

At the time of the acquisition announcement in mid-2024, Borea Asset Management managed just over NOK 10 billion (approximately €900 million) across one equity fund and four fixed income-focused funds. Since then, the firm has launched three additional funds tailored to the needs of Frendegruppen’s clients. As of the end of May, Borea oversees NOK 13.6 billion (approximately €1.18 billion) in assets under management across eight funds. Its special funds — comprising one equity and three fixed income strategies — continue to account for the majority of its asset base. 

With Frende Kapitalforvaltning acquiring a 70 percent stake in Borea Asset Management, the remaining 30 percent remains with the previous ownership group – a deliberate decision to align incentives between the new and existing owners and support the firm’s continued development. “When you share ownership and have the same incentives, it also increases the likelihood of success. It makes for stronger ownership and better conditions for building something great together over time,” says Kjerpeseth. 

“When you share ownership and have the same incentives, it also increases the likelihood of success.”

Jan Erik Kjerpeseth, CEO of Sparebanken Norge.

“A key factor in our decision was the opportunity for market expansion,” Calix Black Ndiaye, a Director at Borea Asset Management, previously told HedgeNordic. “Frendegruppen has an extensive distribution network that will significantly enhance our reach, enabling us to serve new regions and customers more effectively,” he explained. “This larger footprint provides a unique opportunity for growth, allowing us to leverage their infrastructure while continuing to build on our own strengths.”