Asset manager BlackRock has agreed to buy Toronto-based Claymore Investments from Guggenheim Partners for an undisclosed amount, in a bid to boost the firm’s investment fund products and expand its presence in Canada.

News relating to a potential acquisition first emerged in November last year when it was reported that Guggenheim Partners was “considering options” for its Claymore Investments unit, the Canadian exchange-traded funds business it had acquired two years previously.

At the end of December, BlackRock offered 48 ETFs in Canada under the iShares brand, representing C$29.0 billion ($28.5 billion) in assets under management, while Claymore Canada offered 34 ETFs and two closed-end funds, representing C$7.0 billion in AuM.

“Claymore Canada brings a complementary set of ETFs to the world-class iShares range of products and enhances our ability to compete against other investment fund providers in Canada,” said Bill Chinery, head of BlackRock Canada.

Last year ETFs enjoyed strong growth in the 12 months to 30 June, increasing by 39.2 per cent and reaching $1.09 trillion globally. The asset class sector is growing rapidly, as seen by BMO in Canada expanding its ETF business to over $3 billion in AuM in under three years since inception.

The total Canadian funds market totaled C$832.6 billion as of 30 June last year.

Following the sale of the Canadian unit, Todd Boehly, president of Guggenheim Partners, said in a statement that Guggenheim is “strongly committed” to growing its ETF businesses based in the US.  

BlackRock said it expects the transaction to be finalized by the end of the first quarter this year, subsequent to regulatory approvals and “satisfaction of customary closing conditions.”

The terms of the transaction, of which the firm said will be “neutral-to-modestly accretive to BlackRock's 2012 earnings,” were not disclosed.

The firm’s total AuM as of 30 September last year stood at $3.345 trillion.