Schroders has confirmed it is in talks with Cazenove Capital about acquiring the investment firm.
A statement issued by Schroders this morning says: "Schroders confirms that it is in discussion regarding a possible cash offer, with loan note alternative, for the entire issued share capital of Cazenove Capital."
Schroders said the decision "does not amount to a firm intention to make an offer" and it was not certain that Schroders would make an offer for Cazenove.
Under UK takeover regulations, Schroders has until 19 April to make a firm decision on whether to bid for the firm.
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Cazenove Capital, which is a corporate member of the Institute of Financial Planning, was founded in 1823 and has around £18.7bn in assets under administration.
Schroders manages around £212bn on behalf of investors around the world.
Schroders lost a key fund manager last week with the departure of Richard Buxton. Mr Buxton had worked at the firm for 12 years and left to join Old Mutual.
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