MERRION CAPITAL has strengthened its funds management arm with the acquisition of Oppenheim Investment Managers, the Dublin unit of Cologne-based investment group Sal Oppenheim, writes Arthur Beesley, Senior Business Correspondent.

Now a subsidiary of Icelandic bank Landsbanki Islands, Merrion said the acquisition will more than double the size of funds under management in its business. The deal is subject to the approval of the Irish Financial Services Regulatory Authority.

While the consideration was not disclosed, the off-market transaction will provide an entry for Merrion into the institutional funds management business.

Reports in 2005 suggested the business was worth about €20 million when company founder Paul Montgomery sold his remaining 25 per cent stake to Sal Oppenheim. The price paid by Merrion is believed to have been lower than that.

"I think we got a good company with a good track record at a good price," said Merrion chief executive John Conroy.

Oppenheim's Dublin office has some €1 billion under management, mainly for domestic institutional clients.

Merrion's fund management business has between €300 million and €400 million under management, mainly for private clients.

Oppenheim has 15 staff. Joint managing director Kevin Gallacher said he did not expect any major change in the direction of the business. "But it's a very positive move for us, insofar as it gives us a distribution platform and Merrion gets the benefit of our track record."

Paul Montgomery set up the company in 1986 with British fund management firm John Govett. AIB indirectly acquired a 40 per cent of the company when it bought John Govett in 1995. Sal Oppenheim acquired Govett's interest in 1997.