Aberdeen raises £100m from non-voting shares issue

Aberdeen Asset Management has struck a deal to issue £100m of non-voting, perpetual, non-cumulative, redeemable shares to Japanese bank Mitsubishi UFJ and Banking Corporation (MUTB).

The asset manager will issue 200 million shares with a total paid-up amount of 50 pence per share. These will convert to ordinary shares if Aberdeen’s Common Equity Tier 1 Ratio fell below 5.125 per cent.

Aberdeen said the issue to MUTB, which owns about 17 per cent of the asset manager, would provide the company with additional seed capital “for the purpose of launching such new funds as may be thought appropriate to meet customer needs and with a view to generating organic growth in those funds over time.”

Aberdeen said the ability to generate organic growth through the launch of new funds will be enhanced if the company is able to commit increased levels of seed capital so that the funds are launched at a level at which they will be considered credible by the group’s larger distribution partners and advisors.

The preference shares will entitle the holders to a fixed dividend of 5 per cent per annum in priority to ordinary shareholders.

The deal still needs to be approved by shareholders.

Martin Gilbert, chief executive of Aberdeen Asset Management, said: “In line with Aberdeen’s strategy to diversify our range of capabilities and solutions for the evolving investment environment, we have raised £100 million through a Preference Share issue to provide additional capital to seed new products.

“Last year’s acquisition of Scottish Widows Investment Partnership has provided us with a broader range of capabilities, which we aim to develop further. To do this effectively it is important we support new fund launches with seed money, demonstrating our commitment to them. This attractively-priced additional capital will support this increased activity whilst maintaining the strength of the balance sheet.”