The deal, which comes two months after it bought SVG Capital’s stake in private equity joint venture, is expected to add around $6bn in managed assets to the firm’s alternatives business.
FLAG’s business which is focused on real assets, venture capital and small- to mid-cap private equity in the US and private equity in the Asia-Pacific region will be fully integrated into Aberdeen’s current private markets capability. An addition that will see Aberdeen’s business grow to over 50 investment professionals with around $15bn in assets under management.
Overall, the acquisition will bring total assets under management within Aberdeen’s alternatives platform, which is overseen by Aberdeen’s global head of alternatives, Andrew McCaffery, to $21.3bn when the deal closes.
According to Aberdeen, there are a number of benefits to the deal, including a suite of funds with highly stable revenues, a long-established presence across the institutional and high-net-worth client segments in the U.S., and, importantly, expertise in successfully launching private equity and real asset-linked products that it hopes will help it “accelerate organic growth in this business segment”.
Aberdeen added: “The integration of FLAG’s investment platform boosts Aberdeen’s pan-alternatives capability, allowing Aberdeen to provide to its client base a full range of private markets solutions.”
As reason for the continued focus on the alternatives space, Aberdeen CEO, Martin Gilbert, said: “Institutional investors are increasingly looking towards alternative asset classes, including private market allocations, to diversify their portfolios and enhance returns.”
And, he added, not only does it bolster the firm’s private market capability from the outset, it also “deepens and expands our U.S. client base, which is a key growth market for Aberdeen.”
According to a spokesman, Aberdeen has no further acquisition plans at present.
