Man Group to buy NewSmith's investment management business

* Deal is part of diversification strategy

* Says opportunity to manage more funds for Sumi Trust (Adds details, comment from Man Group (LSE: EMG.L - news) president)

LONDON, Feb 20 (Reuters) - The world's biggest listed hedge fund company, Man Group, said on Friday it had agreed to buy the investment management business of NewSmith.

NewSmith, which is 40 percent-owned by Japan's Sumitomo Mitsui Trust Bank (SuMi TRUST), has offices in London and Tokyo with four fund management teams investing in British, European, global and Japanese equities.

"The acquisition brings a new dimension to the firm, including a Japanese hedge fund and an excellent team in Tokyo, as well as adding further scale to our London business," said Luke Ellis, president of Man Group.

Britain's Man Group is looking to diversify its business and made a flurry of acquisitions in the United States last year.

It said the NewSmith acquisition would expand its equities businesses and provide further opportunities to manage funds for SuMi TRUST, which is one of its key clients.

The financial terms of the deal were not disclosed. (Reporting by Matt Scuffham; editing by Simon Jessop and Pravin Char)