ABERDEEN Asset Management, the acquisitive UK fund manager, has called time on takeovers and will focus on building through organic growth, its finance director said yesterday.
The fund manager has made 17 acquisitions since 2001 – the most recent being the January purchase of RBS’s non core fund assets – to become one of Britain’s largest fund managers, with assets under management of £161bn.
“We have got to the stage in the cycle where we are very well placed to enjoy strong organic growth,” finance director Bill Rattray said.
“We have always felt that there was a right time in the cycle to be acquiring – that’s when organic growth was weaker. Right at the moment we’ve built the business, added further diversity so we don’t really need acquisitions to keep growth going,” he said.
In a trading update yesterday, Aberdeen said investors pulled out a net £3.6bn in the five months to the end of February, with fixed income haemorrhaging a net £6.5bn. Equities pulled in a net £4.8bn, while property also saw net inflows of £1.5bn.
“We are slightly disappointed that net redemptions in fixed income have not trended down, although management indicated that redemptions in February were lower than in January,” said Gurjit Kambo, analyst at Numis Securities, which retained a “buy” rating on the stock.
Rattray said revenue margins earned on the inflows were higher than those lost on outflows, pushing up fee income by around £18m per year. “Outflows are beginning to slow down and inflows are picking up, but it’s difficult to call a turning point,” he said.
City A.M. Reporter