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L&G enters European ETF market with Canvas deal

ETFsLegal & General Investment Management (LGIM) has entered the increasingly crowded European exchange-traded fund (ETF) market with the acquisition of the Canvas platform from ETF Securities for an undisclosed sum.

Following Monday’s announcement that Jersey-headquarted ETF Securities is to sell its $18 billion (€15 billion) exchange-traded commodity business to New York-based rival WisdomTree Investments, the sale of the Canvas platform to LGIM means that all of ETF Securities’ European business will, when the deals complete in the first quarter of 2018, be transferred to other firms.

The disposals do not, though, effect ETF Securities’ business in the US and Australia.

The sales are part of a wave of consolidation and increased competition in the asset management industry in general and the ETF space in particular.

The Canvas ETF platform is made up of an Ireland-domiciled Ucits fund and a UK-based investment manager and has $2.7 billion (€2.3 billion) of assets under management (AuM) spread across 17 equity, fixed income and commodities products. 

Employees of the Canvas team will transfer to LGIM as part of the deal.

LGIM is the UK’s largest fund manager with $1.2 trillion of AuM, of which roughly a third are index funds but none of which are ETFs.

Mark Weeks, the UK chief executive of ETF Securities, said: “This transaction reflects growing appetite for innovative content ETFs across the industry and is the result of extensive discussions with LGIM on how we can best work together to deliver new and exciting products to our customers.

“We strongly believe that ownership by LGIM is in the best long-term interests of our ETF investors and we intend to deliver a seamless handover of the business.”

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