Established in 2017, BauMont, which specialises in value-add investment strategies in Western Europe, has an 18-strong team led out of Paris and London with €1.5bn of assets under management.

The acquisition is part of M&G’s strategy to selectively add investment capabilities in areas where active management has the potential to deliver alpha to clients over medium to long-term investment horizons.

M&G plans to expand its client proposition beyond its established core commercial, residential and debt strategies through the acquisition.

Separately, M&G’s with-profits fund is investing €200m in BauMont’s latest fund and is seeking to secure higher returning opportunities in European value-add property in the UK and France for its wider £13bn real estate allocation.

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Last month M&G’s Real Estate Finance team also completed loans worth £200m on two warehousing schemes.

Tony Brown, global head at M&G Real Estate, said: “This new partnership is an opportunity to broaden the real estate strategies we offer at a time when the asset class is back in focus for global institutional clients who are considering increasing their allocations at this stage in the cycle.

“We look forward to a long and successful partnership with BauMont.”

Robert Balick, managing partner at BauMont, added: “We are delighted that M&G is becoming a majority shareholder in our business and we look forward to unlocking the significant growth opportunities that this strategic partnership will create to deliver enhanced value to our investors.”

M&G Real Estate was advised by CBRE Investment Banking.