Financial Services Editor

JP MORGAN Chase is set to expand its South African operation with the purchase of investment administration business Tasc from Sanlam.

The US-based investment bank, one of the top three global players in custodial services, said yesterday its Investor Services division was in exclusive negotiations to acquire Tasc. It expected to sign an agreement with Sanlam shortly. There was no indication of the value of the deal.

Tasc does the back-office administration of R320bn of assets for Sanlam and Sanlam Investment Management, as well as for other asset managers such as Citadel and Quaystone.

Sanlam Investment Management CE Johan van der Merwe said Tasc had grown rapidly to become SA's largest third-party administrator, but further growth depended on its being able to expand into the global arena.

Sanlam selected JP Morgan as the most suitable company to achieve this. The US-based group shared Sanlam's empowerment vision and had agreed to introduce an empowerment partner into Tasc.

Van der Merwe also said Tasc's growth would be aided if it were independent from Sanlam's asset management firm.

JP Morgan has $6,4-trillion of assets under custody globally, making it one of the big three along with State Street and Bank of New York. It is seeking to expand its global investment administration services business and the deal in SA is in line with this strategy.

JP Morgan said yesterday the deal represented a further commitment to investment in SA.

The transaction would result in a transfer of skills between JP Morgan's global offices and Tasc, with international best practices introduced locally.

Mar 09 2004 07:43:17:000AM Hilary Joffe Business Day 1st Edition