Neuberger Berman

Neuberger Berman Group LLC is a private, independent, employee-owned investment management firm. The firm manages equities, fixed income, private equity and hedge fund portfolios for global institutional investors, advisors and high-net-worth individuals.[2] In 2016, it was rated the #1 Best Place to Work in asset management amongst firms with greater than 1,000 employees.[3]

Neuberger Berman Group LLC
TypePrivate
IndustryFinancial services
FoundedNew York City, New York, U.S. (1939)
Headquarters1290 Avenue of the Americas
New York City
Key people
George H. Walker
Chief Executive Officer William A. Arnold
Chief Financial Officer
ProductsInvestment management
Mutual funds
Equities
Fixed income
Private equity
Hedge funds
Alternative investments
AUM$339 billion (September 2019)[1]
Number of employees
2,000+ (2019)
Websitewww.nb.com

Overview

Founded in 1939,[4] Neuberger Berman is a privately held asset management firm, which is 100%[5][6] owned by its employees. It serves pension plans, charitable organizations, sovereign wealth funds and other institutions, as well as high-net-worth individuals and mutual fund investors, both directly and through financial intermediaries and other partners. The firm has a broad range of investment capabilities, which have enabled it to win numerous public strategic partnership mandates with both leading institutional pension plans and major financial institutions. [4] For its private clients, Neuberger Berman also provides financial planning, fiduciary services, and trust services. Known as a firm of investors, the firm has maintained a 97% retention rate among its senior investment teams since 2009,[7] and has been recognized for its distinctive firm culture.[8][9]

History

Neuberger Berman was founded as "Neuberger & Berman" in 1939, by Roy Neuberger and Robert Berman.

In the decades that followed its founding, the firm's growth mirrored that of the asset-management industry as a whole. Its success in managing separate accounts, led it to establish the Guardian Fund, in 1950, one of the first no-load mutual funds in the United States. Today, the firm's complex of open and closed-end mutual funds, includes other well-known funds, including Century Fund (renamed Large Cap Disciplined Growth Fund) and Genesis Fund. In the 1960s, the firm expanded into the management of pension plans and assets of other institutions.

Pre-Lehman bankruptcy logo

After 60 years as a private firm, in October 1999, Neuberger Berman conducted an initial public offering of its shares and commenced trading on the New York Stock Exchange, under the ticker symbol "NEU". With the firm's IPO, Larry Zicklin, who had joined the firm in 1969, retired as Chairman of its executive committee. He was succeeded as Chief Executive Officer by Jeffrey B. Lane.

In September 2017, Neuberger Berman bought Toronto's Breton Hill Capital for US$2 billion in assets under management.[10][11]

Lehman Brothers acquisition and bankruptcy

In July 2003, shortly after the retired Mr. Neuberger's 100th birthday, the company announced that it was in merger discussions with Lehman Brothers. These discussions ultimately resulted in the firm's acquisition by Lehman on October 31, 2003, for approximately $2.63 billion in cash and securities, or approximately 26 times earnings.[12] That transaction closed in October 2003 and from that time, until 2008, Neuberger Berman served as one of the asset management arms of Lehman Brothers’ Investment Management Division. In that same year, Lehman acquired fixed income manager Lincoln Capital Fixed Income Management and private equity manager Crossroads Group.[4]

Management buyout

On September 15, 2008, virtually unprecedented volatility in global securities markets resulted in Lehman Brothers’ collapse and bankruptcy filing. Neuberger Berman continued to operate, notwithstanding Lehman's bankruptcy and sought opportunities to spin itself off from its parent. On September 29, 2008, Lehman agreed to sell its asset management businesses, including Neuberger Berman, to a pair of private-equity firms, Bain Capital Partners and Hellman & Friedman. The transaction was expected to close in early 2009;[13] however, a competing bid was entered by the firm's management, who ultimately prevailed in a bankruptcy auction held on December 3, topping the deal with Bain and Hellman.[14] The firm spun itself off in May 2009, in a transaction recognized by Fund Industry Intelligence as Deal of the Year.[15] Lehman Brothers' creditors initially retained a 49% common equity interest in the firm and an $875 million preferred equity stake.[14] with a coupon that climbed to 12% over three years. The preferred equity position was fully repaid in 2012.[16][17] The new entity, including Neuberger, Lincoln Capital, and Crossroads, was named Neuberger Berman Group LLC.[18] Under employee control, Larry Zicklin rejoined the firm as a member of the Board of Directors. Lehman Brothers creditors have received over $1.5 billion from the employees of Neuberger Berman, dwarfing the proceeds paid by Barclays and Nomura for businesses representing 90% of Lehman Brothers employees.[4]

Independence and expansion

Since its reemergence as an independent firm, Neuberger Berman has enjoyed a period of sustained growth. The firm increased its assets under management 14% per year from 2010 to 2014,[5] reaching $250 billion,[19] which placed the firm at the top of its peer group by asset growth.[5] The firm currently employs approximately 2,000 people,[19] and has expanded beyond its traditional equity focus into the growing areas of emerging markets debt,[20] high-yield bonds,[21] liquid alternatives and private equity,[22][4] among other strategies. During this period the firm expanded its global presence, adding coverage offices in key Asia-Pacific markets and elsewhere to be closer to a growing overseas client base.[23]

The end of 2014 marked Neuberger Berman's return to full employee ownership, highlighting the firm's independence and clearing the path for future growth.[5][24] Employee ownership has been recognized by industry leaders as a key factor in the success of asset management firms, and Neuberger Berman's position as an employee-owned firm is cited as a reason for its high talent retention rate.[25] In recognition of its culture, Neuberger Berman won the top rank in its category on Pensions & Investments' 2016 Best Places to Work in Money Management survey,[3] and had been named to the Best Places list in 2013, 2014, and 2015.[26][27][28]

Offices
1290 Avenue of the Americas, New York City.

In October 2016, the firm moved its global headquarters to 1290 Avenue of the Americas in midtown Manhattan.[29][30]

In addition, the firm has approximately 28 other offices in key countries around the world. Regional headquarters are in Hong Kong, London and Tokyo, and has additional primary portfolio management centers in Atlanta, Chicago, Dallas, Milan, The Hague and Singapore.[30]

Former headquarters in New York City include 605 Third Avenue,[29] 522 Fifth Avenue and, originally, The Biltmore Hotel.[31]

Philanthropy

Collectively, Neuberger Berman's philanthropic efforts are called NB Impacts. NB Impacts includes both employee community service and the grant-making actions of the Neuberger Berman Foundation.[32] The Neuberger Berman Foundation offers grants focusing on at-risk children, youth educational programs, and economic sustainability.[33][34][35]

Neuberger Berman conducts an annual week-long program in the spring called “Celebration with Service,” which holds community service events in the cities where the firm has offices.[32][36][37] For its 75th anniversary year in 2014, the firm's “Celebration with Service” supported 75 volunteer projects worldwide.[32] Since 2012, NB Impacts has deployed more than 4,500 volunteers to work with over 5,000 youth and 800 senior citizens, and also includes approximately 2,000 volunteer hours spent on improving parks and community spaces.[32][38] Through the years, some of the programs Neuberger Berman has been involved in are: The Y,[39] Homes for Heroes,[40] Per Scholas,[41] C-CAP,[42] New York City Service,[43][44] and Habitat for Humanity.[45]

Corporate art collection

Contemporary art in the workplace has been part of Neuberger Berman's corporate culture since 1939, when collector Roy Neuberger co-founded the investment firm.[26] In 1990 the firm began developing its own art collection.[46][47] The firm's corporate art collection was absorbed into the Lehman Brothers collection but Neuberger Berman repurchased, many of them when the collection was sold at auction in 2010.[48] Today, the Neuberger Berman Collection supports the work of contemporary artists, displaying their work in the firm's hallways, reception areas and meeting rooms.[26]

Notable employees and alumni

See also

References
  1. Celebrating Neuberger Berman at 80 Years
  2. "Neuberger Berman Commemorates Firm's 75th Anniversary With Annual "Celebration With Service"". www.cnbc.com (Press release). 25 April 2014. Archived from the original on 5 May 2014.
  3. Investments, Pensions & (12 December 2016). "The winners". Pensions & Investments.
  4. "Neuberger Berman Rises From the Ashes". Institutional Investor.
  5. Jr, Landon Thomas. "A Chief Delivers Neuberger Berman From the Shadow of Lehman". DealBook.
  6. "Neuberger Berman employees put a bow on buyback". Pensions & Investments. December 22, 2014.
  7. "Neuberger Berman completes MBO from Lehman". Investment Week. 22 December 2014.
  8. "Best places to work: NEUBERGER BERMAN GROUP". Pensions & Investments. December 9, 2013.
  9. Du, Yi (December 8, 2014). "Best places to work: winners of 2014". Pensions & Investments.
  10. "Neuberger Berman acquires Toronto's Breton Hill Capital - International Investment". International Investment. 2017-09-25. Retrieved 2017-10-04.
  11. "Neuberger Berman acquires Canadian quant firm Breton Hill". investmentweek.co.uk. Retrieved 2017-10-04.
  12. Thomas, Landon Jr. (2003-07-23). "Market Place; Lehman to Buy Neuberger Berman For $2.6 Billion". NYTimes.com. Retrieved 2008-08-30.
  13. "Neuberger Berman sold for $2.15B, September 29, 2008". Archived from the original on September 30, 2008.
  14. https://www.nytimes.com/2008/12/04/business/04lehman.html Managers Win Auction for a Part of Lehman
  15. Fund Industry Intelligence 2009 Deal of the Year
  16. http://www.mfwire.com/article.asp?storyID=40224&template=article&bhcp=1
  17. "How to survive a Wall Street meltdown". Fortune.
  18. "Who We Are". www.nb.com.
  19. "Home". Neuberger Berman. 28 September 2017.
  20. "Neuberger Berman Hires Emerging-Market Debt Group From ING". www.bloomberg.com. 1 May 2013. Retrieved 12 January 2020.
  21. Kozlowski, Rob (14 August 2013). "Neuberger Berman picks senior portfolio manager for global bonds". Pensions & Investments.
  22. Chambers, Benjamin. "Neuberger Berman adds former Carlyle Mezzanine head Susan Kasser - AltAssets Private Equity News".
  23. "Neuberger Berman Boosts Assets in East Asia, Plans More Hiring". www.bloomberg.com.
  24. Comtois, James (22 December 2014). "Neuberger Berman employees put a bow on buyback". Pensions & Investments.
  25. "Neuberger Puts Lehman 'Dark Days' in the Past". FundFire.
  26. Comtois, James (9 December 2013). "Best places to work: NEUBERGER BERMAN GROUP". Pensions & Investments.
  27. Du, Yi (8 December 2014). "Best places to work: winners of 2014". Pensions & Investments.
  28. Webman, Nancy K. (14 December 2015). "34 managers selected for 2015's Best Places to Work". Pensions & Investments.
  29. "Neuberger Berman to Move Headquarters to Vornado Tower". www.bloomberg.com. 1 May 2014. Retrieved 12 January 2020.
  30. "Office Locations". Neuberger Berman. 1 March 2019.
  31. "Coming full circle | Institutional Investor".
  32. "Neuberger Berman Commemorates Firm's 75th Anniversary With Annual \". MarketWatch.
  33. "The Neuberger Berman Foundation - GuideStar Profile". www.guidestar.org.
  34. "Neuberger Berman Lung Cancer Research Center | Weill Cornell Medical College". Archived from the original on February 22, 2015.
  35. "Summer of serving one's community - The Queens Chronicle".
  36. LLC, Neuberger Berman Group. "Neuberger Berman Marks Anniversary with Annual "Celebration with Service" Community Service Events". www.prnewswire.com.
  37. "Neuberger Berman Begins Annual "Celebration with Service" Community Service Events". www.businesswire.com. 27 April 2012.
  38. Comtois, James (12 May 2014). "Neuberger Berman employees help spruce up community". Pensions & Investments.
  39. "How the Y's partnership with the Neuberger Berman Foundation is helping change lives - YM & YWHA". Archived from the original on 2014-07-15. Retrieved 2014-07-14.
  40. "Berman Gives Back to Homes For Heroes Veterans - Nyack-Piermont Patch".
  41. "Neuberger Berman - Per Scholas". Archived from the original on 2015-04-02. Retrieved 2014-07-14.
  42. ""Everything speaks" or, C-CAP Alumni Get Coached by the Marketing Masters". Archived from the original on 2015-04-02. Retrieved 2014-07-14.
  43. "DYCD and NYC Service Conclude the 3rd Annual Summer of Service Initiative - NYC Department of Youth & Community Development" (PDF).
  44. "NYC SERVICE INITIATIVES SUMMER OF SERVICE - NYC Service". Archived from the original on 2014-07-15. Retrieved 2014-07-14.
  45. "Partners we work with". Habitat for Humanity Homes.
  46. "Freeman's Appointed to Sell Works from The Neuberger Berman and Lehman Brothers Collections". artdaily.com.
  47. "Art History".
  48. "The Art Newspaper".
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