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Continued: Despite drop in deals, dealmakers see strong market ahead

In November, U.S. Bancorp’s investment fund-service subsidiary said it would acquire Quintillion Ltd., an Ireland-based hedge fund administration firm, for an undisclosed amount.

Quintillion is an independent fund manager based in Dublin that was founded in 2006. The firm’s 53 employees will become U.S. Bancorp employees.

Ireland is a popular low-tax haven for U.S. companies and has an educated workforce. Ireland also functions as a gateway to Europe.

The deal adds $18 billion in assets and another European hub to U.S. Bancorp’s hedge fund operations, which currently have locations in Wisconsin, New Jersey, the Cayman Islands and London. After the deal, the bank will manage $832 billion in assets for more than 2,900 funds.

“This enables us to enhance our European presence,” Terrance Dolan, vice chairman of the bank’s wealth management and securities services, said in a prepared statement. It also “complements our focus on the expansion and diversification of our alternative investment business.”

Equity offerings

On the capital-raising side of the deal business, more U.S. companies raised funds through initial public offerings or secondary offerings of stock in 2013 than 2012 in what also was the best year since the recession as surging stock markets set all-time highs.

More than 200 companies, including 63 in the fourth quarter, launched initial public offerings last year, up from 131 in all of 2012. Additional offerings also increased nationally as 754 public companies sold additional shares in 2013, up from 599 in 2012.

In Minnesota, Dakota Plains Holdings, SPS Commerce, Cardiovascular Systems and Norcraft Companies were among the firms that went to the equity well in the fourth quarter.

Most observers think the deal flow will continue unabated amid projections of continued economic recovery in 2014.

PricewaterhouseCoopers, the accounting and consulting firm, said CEOs responding to its 17th annual CEO survey this month are bullish on acquisitions. Nearly 40 percent said they plan to complete a domestic acquisition this year and 28 percent plan an international deal. With markets stable thanks to relative budget peace in Washington, D.C., and big companies holding record amounts of cash on balance sheets, the dealmakers are optimistic.

“From a macroeconomic perspective, we have a stronger economy, we have Congress behaving more responsibly, and we have all appearances of stability at the Fed,” Scott Barshay, head of the corporate department at Cravath, Swaine & Moore, a top Wall Street law firm, told the New York Times earlier in January. “CEOs can look forward and say, ‘I don’t see any near-term economic bumps.’ ”

 

Neal St. Anthony • 612-673-7144 • nstanthony@startribune.com

Patrick Kennedy • 612-673-7926 • pkennedy@startribune.com

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