During the past few years, a large number of mergers, acquisitions and takeovers have been reported in the Indian mutual fund industry. The buyer may either purchase the mandate to manage the schemes currently managed by another company or acquire the ownership of that company. The consideration paid in either case is a percentage of Assets Under Management (AUM). All AMCs (AMCs) in India are privately held and are unlisted. An unlisted company is usually valued using a comparable, firm approach. As the entire universe of AMCs in India is made up of unlisted companies, such an approach is not feasible. This paper attempts to use the free cash flow approach to derive an explicit framework for valuation of unlisted AMCs. We first analyze the building blocks of asset management activity. Based on this analysis, an innovative Capital Asset Pricing Model (CAPM) based framework is suggested for valuing AMCs. The methodology is described in detail and applied to the non-UTI segment of the industry. The results seem to validate the current valuations reported in the business press. The methodology is seen useful to explicitly incorporate strategic expectations in valuation exercise.