Janus buys ETF shop Velocity Shares

Janus Capital Group Inc. said Monday it agreed to acquire exchange-traded product firm VelocityShares for at least $30 million.
The acquisition comes on the heels of Janus’ hiring of Bill Gross, one of the most successful bond investors in history, from Pacific Investment Management Co., the firm he co-founded in 1971. It positions Janus, a traditional mutual fund provider, in the fast-growing exchange-traded fund market.
(More: On Bill Gross’ next chapter at Janus)
“This acquisition positions Janus within the rapidly growing rules-based and active ETF universe, enhancing the customized solutions we can provide to our clients and enabling us to work with the growing segment of financial advisers and institutions focused on these instruments,” said Richard M. Weil, the Janus chief executive, in a statement.
Denver-based Janus will pay an “initial upfront cash consideration of $30 million” to buy VelocityShares parent company VS Holdings Inc. The Darien, Conn.-based firm manages $2 billion in ETFs.
Through the acquisition, Janus is adding clients including hedge funds as well as mutual and pension funds. Janus shares have risen 26% since Mr. Gross announced he would work for the Denver-based firm on the expectation that he would attract new investors to the company’s funds.
(Bloomberg News contributed to this report.)