UPDATE 3 — Standard Life Aberdeen will on Monday announce it acquired Orion Partners, an Asian real estate investment firm, following news that Japan’s Mitsubishi UFJ Trust & Banking Corp sold its entire 5.9% stake in the Edinburgh-based investment giant.
Shares of Standard Life Aberdeen have fallen about 6% to around 234p since Mitsubishi UFJ announced on Friday it sold 148.6 million shares for £349.3 million.
Standard Life Aberdeen’s current stock market value is about £5.8 billion, but its share price has roughly halved in the past year.
Standard Life Aberdeen’s Japanese distribution deal with Mitsubishi remains in place.
Some analysts had been expecting this stake sale by Mitsubishi since it agreed to buy First State, a fund management business of Commonwealth Bank of Australia, in October.
“MUFG is proceeding with the optimization of capital management in the face of tightened international financial regulations and changes in the business environment,” said Mitsubishi.
“In that context, MUFG is conducting a review of existing strategic investments by MUFG group companies from the viewpoint of strategy and capital efficiency …
“Although the Trust Bank has now decided to sell these shares after careful consideration based on changes in the business environment surrounding MUFG and the Trust Bank, Standard Life Aberdeen will continue to remain our important partner.”
Meanwhile, SLA’s asset manager Aberdeen Standard Investments (ASI) has expanded further its Asia Pacific real estate capability with the acquisition of Orion Partners, an Asia real estate investment management firm with offices in Hong Kong, Tokyo, Seoul and Singapore.
The deal bolsters ASI’s investments in Asia real estate and adds to its £43.9 billion global real estate franchise.
Orion Partners manages £709 million of direct real estate investments in Asia for international institutional investors.
The transaction expands ASI’s global real estate capabilities and offerings with the addition of Orion Partners’ direct real estate team and established track record in Asia.
Hugh Young, Head of Asia Pacific, Aberdeen Standard Investments, said: “For investors seeking diversification, Asian real estate offers attractive risk-adjusted returns, with less correlation to broader market volatility.
“Having established a track record across equities, fixed income, private equity and real estate multi-manager investing in Asia Pacific over the years, this is a good opportunity for us to build out our regional real estate presence.
“At a time when global investors’ allocation to alternatives and real assets are growing, being able to offer a truly one-stop real estate solution is an integral part of our growth strategy.”
Kang Puay Ju, Head of Real Estate Asia Pacific and Global Head of Real Estate Multi-Manager, Aberdeen Standard Investments said: “Our real estate multi-manager business has invested with Orion Partners in Asia Pacific for more than a decade; it is a team we have known well and admired for its client-focused and transparent approach, much in line with ASI’s own culture.
“The addition of the on-the-ground direct real estate teams in Japan, Korea, Hong Kong and Singaporewill deepen our local insights and broaden our product suite across the region.
“The platform’s specialist skillsets and investment experience in offices, aged care and retail properties will prove invaluable to the growth of our real estate offerings.”
David Paine, Global Co-Head of Real Estate, Aberdeen Standard Investments, said: “Today marks the next stage in developing our real estate business by expanding our footprint in Asia Pacific.
“The acquisition of Orion Partners reinforces our position as aleading real estate manager delivering world-class investment capability.
“With one of the largest and most sophisticated real estate investment offerings globally, a client-led mind-set and a passion for innovation, this further enhances our ability to meet investors’ evolving needs.”
The terms of the transaction were not disclosed.