The Dutch pension asset manager's Asia Pacific head of real estate says his team has just had one of its busiest years ever and that 2021 is looking similarly promising.
The shares were purchased by Tokyo-listed Mitsubishi UFJ, Japan's largest bank in terms of assets, from shareholders of London-listed Aberdeen in the open market for around Ñ20 billion ($188 million). Aberdeen declined to identify the sellers.
Mitsubishi UFJ has a market capitalisation of $92 billion, $1.1 trillion in bank deposits, and $245 billion in assets under management. Aberdeen has an AUM of $226 billion worldwide, including around $48 billion in Asia. Up until this deal, Aberdeen has noted that it has ôno ties to other financial institutionsö, allowing it to focus on its clientsÆ interests, according to the group profile on its website.
The deal with Aberdeen follows Mitsubishi UFJ's decision last week to purchase a 21% stake in Morgan Stanley for $9 billion, in the US investment bankÆs bid to raise capital and shore-up investor confidence amid the financial market turmoil in the US.
Aberdeen says the sale was not part of any capital raising measure because the fund house is not in need of fresh capital. The sale was largely made to facilitate a deal with Mitsubishi UFJ in order for Aberdeen to enter the hard-to-penetrate Japanese market.
The deal ôaccelerates a strategic objective of establishing ourselves in Japan, a key market for usö, says Aberdeen CEO Martin Gilbert, adding that the fund houseÆs offerings in global equities, emerging market equities and global fixed income complement the trend of Japanese investors looking to invest overseas.
Japan is the second largest pensions market in the world, with assets estimated at $3.1 trillion. The alliance is expected to provide Aberdeen with a cost effective way to develop its business in Japan. Japanese institutions and pension schemes are increasingly allocating assets outside their domestic market and via specialised mandates, and Aberdeen is hoping to get a piece of that market.
In Asia, Aberdeen is based in Singapore. Investments are run on a team basis, with the 14-strong regional equity team based in Singapore overseeing local teams in Bangkok, Kuala Lumpur, Sydney, Hong Kong, and Tokyo. These local teams provide stock research and ideas to the regional team as well as manage domestic funds.
Under the terms of the business alliance, Mitsubishi UFJ will have exclusive rights to promote Aberdeen products to Japanese institutions. The agreement initially covers AberdeenÆs emerging market equities, global equities, and global fixed-income products.
Under the terms of the capital alliance, Mitsubishi UFJ initially acquired 9.9% of Aberdeen's issued share capital from shareholders. The bank may purchase further shares up to an agreed maximum aggregate shareholding of 19.9% of Aberdeen's issued share capital within 18 months. The bank will be entitled to appoint a non-executive director to the board of Aberdeen when its holding reaches 15% or more of the fund houseÆs issued share capital, a right that will be taken away if the business alliance is terminated after two years.
Mega players Nippon Life and Dai-ichi Life are looking for opportunities in higher-yield single-A US corporate bonds, which offer more appealing yields than stagnant domestic offerings.
The “lower for longer” monetary policy and stimulus packages, coupled with the rolling out of vaccine programmes favorably support real estate investing in the region, with offices and data centres presenting forward-looking opportunities.
As US fixed income default rates rose and yields fell during the pandemic, are Asian bonds, which have had more stable yields through 2020, looking more attractive?
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