The emerging markets specialist established the office in Riyadh through a new subsidiary called Ashmore Saudi, which will initially launch four funds giving onshore and offshore investors a choice of exposure to Saudi, GCC, global equity and debt products.
International Adviser revealed last month that Ashmore was stepping up its activity in the Middle East, with the appointment of its former Turkey chief executive Johan Hattigh to lead its efforts in Saudi Arabia.
Ashmore said its Saudi Arabia team will target institutional and private clients by marketing directly to institutions, family offices and high net worth individuals and highlighted that Saudi Arabia has been one of the best performing G20 economies in recent years.
Mark Coombs, Ashmore Group chief executive, said: “Opening this subsidiary is part of Ashmore’s strategy to build local businesses in key emerging markets. Establishing our first office in the Middle East in Riyadh clearly demonstrates our confidence that the country’s young but significant asset management market will continue to grow at an impressive rate.”
Khalid Al-Sweilem, chairman, Ashmore Investment Saudi Arabia, said: “Ashmore is the first dedicated international investment manager to establish a business in the Kingdom of Saudi Arabia and we believe that the combination of local talent and Ashmore’s global investment management expertise and track record will allow us to develop a leading business in the Saudi investment management market.”
‘Milestone event’
Ashmore also stated that the IMF predicts the economy will grow 4.6% this year, and the recent announcement that foreign investors will be allowed direct access to the Saudi Arabia equity market was “a milestone event and of significant importance to investment managers such as Ashmore”.
The Tadawul All Share index comprises over 160 companies with a total market capitalisation of $530bn which puts the market on a par with South Africa and Malaysia, and makes it larger than Turkey, Indonesia and Mexico.
In Ashmore Group’s interim statement released today, it revealed assets under management of $71.3bn which was $3.7bn lower than at 30 June 2014. This was attributed to negative investment performance of $3.4bn and net outflows of $0.3bn.
Coombs said the decline in assets under management over the quarter reflected predominantly the correction in markets towards the end of the period, driven by US dollar strength.
