Emerging markets boutique Blackfriars Asset Management is lining up ambitious plans to expand into the wider UK investment marketplace following its acquisition of BDT Invest.
Blackfriars, which was spun out of BNY Mellon after the financial crisis, bought Asian equity boutique BDT in June to take its assets over £500m.
The business is now looking to use its emerging market and Asia expertise to double its assets to more than £1bn in the next 12 months.
Blackfriars chief executive Tom Waring said a big step in that expansion was likely to be a move to start selling its funds to discretionary managers, something which the institutionally-focused firm had yet to attempt.
Mr Waring said: “Blackfriars has traditionally not engaged with the DFM space in the UK – we are, by history, more institutionally focused.
“But having BDT opens the door to beginning to think about operating more in the DFM space in the UK.”
Mr Waring said the firm had previously been hesitant to take its products out to the wider market until they had built up a long enough track record.
He said while the Blackfriars managers had a long track record of running emerging market money, the type of product it wants to bring to the market is different to that which the managers had been running institutionally.
“Our old products were mainly institutional and benchmark constrained mandates, but that trend is changing,” he said.
“People want more focused products. We have been running these [focused] products for some clients but we are not well known for it, so it has taken us a bit of time to build up a track record.”
The acquisition of BDT has already given Blackfriars access to the retail market through the Establishment Investment Trust, and Mr Waring said the combined firm would also look to use the expertise and contacts of BDT’s client relationship and marketing director Steven Simmons.
But the firm has also signed a deal with Spring Capital to outsource the distribution of its funds to a third party.
Mr Waring said he had been keen to outsource Blackfriars’ distribution because he was a “believer in partnering up with specialists in order to go to market”.
Blackfriars currently runs three pooled investment products, two focused on global emerging markets and one just on eastern European emerging markets, while BDT manage an Asian Focus fund and an Oriental Focus fund, in addition to the investment trust.
Mr Waring said Blackfriars was also looking to expand its range by launching a concentrated specialist developing markets product in the third quarter of this year which, like the firm’s other funds, will be domiciled in Dublin.
He said any future expansion would be limited by the fact that he wants the firm to remain a specialist in developing markets, but he said future products might involve a long/short fund that would use the expertise of BDT’s managers in that area.
