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Rating:Aberdeen Has Ambitions for the U.S. Not Rated 5.0 Email Routing List Email & Route  Print Print
Tuesday, October 23, 2012

Aberdeen Has Ambitions for the U.S.

Reported by Tommy Fernandez

Aberdeen Asset Management [profile] has big ambitions for the United States.

"The U.S. is one of our biggest priorities in terms of growth," said chief executive Gary Marshall to MFWire staffers Monday. "Given the fact that 50 percent of the world's wealth is in the US. If you're not here, you're kind of out of the loop."

Aberdeen Asset Management Inc. is the U.S. arm of Aberdeen, Scotland-headquartered Aberdeen Asset Management PLC, which was founded in 1983. It's had operations in the U.S. since 1995 and established its North American headquarters in Philadelphia in 2005. It manages roughly $50 billion in assets for its Americas clients.

Currently, 15 to 20 percent of Aberdeen's business is in the U.S. They'd like to grow that proportion to 30 percent to 40 percent in about five years.

"We'd like to be bigger," Marshall said.

A big symbol of Aberdeen's ambitions in the U.S. was the opening of the firm's New York office on October 11. The fete featured: Sir Peter Westmacott, British Ambassador to the United States; and Roger Cornick and Martin Gilbert, respectively the chair and chief executive Aberdeenís Scotland-based parent.

"The NY office is a symbol of that ó we want to be here," Marshall said.

This New York office, located at 712 Fifth Ave., will serve as a business development and marketing center for Aberdeen. With a total capacity for 25 personnel, it will be permanently staffed by around 15 people with room for other executives who visit the city. For example, Marshall himself spends one to two days each week in New York.

They currently have around 80 sales and distribution staffers, after hiring nearly 15 in the past year. Eight are in the field as regional wholesalers and they are supported by another four internal wholesalers. Aberdeen does plan to hire more people, but it will make these hires strategically in response to what kind of growth in asset flows it sees in particular markets, developing the infrastructure to support this growth.

In addition to the New York office and the Philadelphia headquarters, Aberdeen has installations in Los Angeles, San Francisco, Dallas, Chicago, Miami, and the Northeast Corridor.

They will also pick up the pace in advertising and marketing as they enter new areas and have the staff and resources to meet the resulting demand.

They are upping their presence at industry conferences as well as sports sponsorships, like the Aberdeen Dad Vail Regatta, the largest intercollegiate rowing event in the country.

Marshall is looking to grow by promoting Aberdeen's global expertise, such as in emerging market debt, to clients looking for high yield products outside the mainstream.

"One of the big trends is global. Everyone is looking for yield, but the key is doing that in a controlled manner without massive risk," he says.

The firm is looking at potentially developing new products in such categories and regions as China, smaller Asian companies, Latin American equities, emerging market debt including corporate and local currencies.

Much of their marketing efforts is focused about promoting their investment process, which Marshall said was very disciplined," and very uniform, is applied in the same way in throughout their offices globally.

They are also open to acquisitions. Marshall said Aberdeen is known for being acquisitive and that they are regularly approached by firms for potential buyout.

Currently, he said, Aberdeen has an appetite for mature U.S. fixed income shops, including those that specialize in U.S. Treasuries, as well as those established in physical real estate. They're open to equities as well, but the key here would be to find something that will fit within Aberdeen's global operations in this asset class.

"We're not big enough to turn our nose up to anything," he said.

Aberdeen also plans to do a lot of cross pollination between its U.S. and global operations, flying staff back and forth around the globe.

The major challenges are the size and competitive nature of the U.S. market. Marshall is fully aware that while his firm can spend millions to grow in the U.S., other firms can spend tens to possibly hundreds of millions. The U.S. market is also highly fragmented and players need to drill down deep into the different market sectors to recognize their differences and the different skillets involved.

"The U.S. is clearly the most competitive market in the world. You are competing with the best," he says. 

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