Posted inBusiness moves

Aberdeen buys Value Partners’ Taiwan fund business

Aberdeen Asset Management has expanded its Taiwan business by acquiring full ownership of Value Partners Concord Asset Management.
Fund Selector Asia

The transaction amount was not disclosed.

Aberdeen will merge the acquisition with its existing Taiwan business, Aberdeen International Securities Investment Consulting Company, set up a decade ago. It currently only allows the firm to distribute Luxembourg funds domestically.

“The significance of this deal is not so much about what we are buying now as what it will allow us to do in the future”, which is to “introduce new asset strategies and broaden distribution via onshore funds and segregated mandates”, said Michelle Maa, general manager of Aberdeen’s Taiwan operations, in a statement.

The onshore platform allows the firm to launch Taiwan-domiciled funds and be more flexible on product design to cater the needs of local investors, a spokeswoman for Aberdeen said. It also brings a discretionary mandate license.

Aberdeen sells 26 offshore funds in Taiwan, and most of them are equity focused. The firm aims to develop locally-domiciled multi-asset funds, which “may be of particular interest to insurance and other institutions seeking outcome-orientated solutions”, according to the statement.

VP Concord was set up by Value Partners in 2011. The other major shareholder is Taiwan-based Concord Securities Group.

It now manages one locally-domiciled fund, the Value Partners Concord Greater China Value Fund with NT$125m ($4.1m) of assets under management as of the end of May.

“The existing fund that VP Concord has will be under evaluation by Aberdeen’s investment team. Upon local regulatory approval, we will be disclosing more details,” the spokeswoman added.

A Value Partners spokeswoman said the firm “will continue to work with its business partners in Taiwan to distribute its funds through private placement and offshore platforms.

“Value Partners remains positive on the growth prospect of Taiwan’s domestic economy and fund management market,” she said.

Domestic domicile

Taiwan’s regulator, the Financial Supervisory Commission, has been tightening rules on distributing funds offshore in the past few years. The regulator has limited assets allowed to be raised onshore and restricted the types of funds that can be registered. It has also encouraged fund houses to launch domestically-domiciled funds.

In Taiwan, total assets in offshore funds stood at around $103bn as of the end of March, accounting for 46% of Taiwan’s $224bn fund management industry. Onshore fund assets account for just 30% of the industry, and the remaining assets are managed by discretionary mandates, as reported earlier.

Aberdeen is in the process of merging with Standard Life Investments, which is expected to be completed August 14. SLI does not have presence in Taiwan.

Part of the Bonhill Group.