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Japan's largest banking group snaps up 9.9% stake in Aberdeen

Japan's largest banking group snaps up 9.9% stake in Aberdeen

Japan's Mitsubishi UFJ Trust and Banking Corporation (MUTB) has moved to secure a 9.9% stake in Aberdeen Asset Management.

Under the terms of the deal MUTB has said it intends to buy up 9.9% of Aberdeen's issued share capital from existing shareholders initially, while it has an option to raise its stake to a maximum of 19.9%.

If it takes its stake over 15% MUTB, part of the Mitsubishi UFJ Financial Group which is the largest banking group in Japan with a market cap of $92 billion, will also be entitled to appoint a non-exec director to the Board of Aberdeen.

MUTB has also agreed not to raise its stake above 19.9% in the next 18 months, unless the business alliance is terminated before that time.

As part of the deal, MUTB has agreed to promote Aberdeen's products - including its emerging market equities, global equities and global fixed income products - in the Japanese institutional market.

Aberdeen noted that the deal would give the company access to Japan in a cost effective way, and provided it with a solid platform to operate in the Japanese market.

Chief executive of Aberdeen, Martin Gilbert(pictured) said: 'Aberdeen's partnership with MUTB provides an exciting opportunity to enhance our global distribution and broaden our client base. Furthermore our strong product offerings in global equities, emerging market equities and global fixed income complement the trend of Japanese investors looking to invest overseas.'

Reacting to the deal, Cazenove maintained its outperform rating, noting that there could be numerous benefits thanks to the deal but that more detail was needed.

It said: 'It is too early to be adding benefits from this relationship to our estimates, in our view, especially given the lack of information regarding the charging structures which may apply and the volume of flows which may be expected. What we can say, however, is that this relationship offers upside to estimates which will not be available elsewhere in the sector.'

By 09:14am, shares in Aberdeen were up 5.3% or 6.75p, at 133.25p.

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