The new agreement, announced on Monday, is designed to give the UAE-based clients of Abacus access to Brooks Macdonald’s full range of international investment management services – including its discretionary multi-asset, direct equity and bond strategies.
It will also allow Abacus’ clients to benefit from Brooks Macdonald’s team of over 90 investment professionals across the UK and Channel Islands. In addition Brooks Macdonald will offer additional services to Abacus in the form of enhanced reporting, training and marketing support.
“This the first of what I hope will be many strategic alliances outside the UK,” Darren Zaman, chief executive, international, at Brooks Macdonald told International Adviser.
Brooks Macdonald, which currently has around £9bn ($11.2bn, €10.3bn) under management, uses strategic alliances to grow and deepen in relationships with financial advisory firms. It currently has around 10 strategic alliances in the UK but internationally has to-date relied on 50-60 adviser firms in various expat centres around the world to introduce clients.
Zaman said, having acquired a business in the Channel Islands in 2012 to handle this international business, it was an obvious next step to replicate the strategic alliance approach where appropriate.
He said the alliances allow the firms involved to remain independent while making a commitment, in terms of time and resources, to get to know each other better to the benefit of both businesses and their clients.
“It’s a conversation we’d be prepared to have with any company looking to engage with DFMs,” Zaman said.
Con Lillis, the co-founder of Abacus, which holds the Securities and Commodities Authority (SCA) licence, described the alliance as a "landmark moment" for the company.
"Like many other financial advisory markets around the world, the environment in Dubai is fast changing as financial regulation and client needs evolve with the times," Lillis said.
“Partnering with Brooks Macdonald – like us, a pioneer of fee-based advice – underlines how we are responding positively to these regulatory changes in Dubai, as local demand grows for quality, holistic advice with well recognised discretionary investment managers."
Lillis said that in the past Abacus had tried to manage its own portfolios on behalf of clients. “But we decided this was incredibly cumbersome and time consuming for us and we don’t have the automated systems that allows us to rebalance the portfolios daily, monthly or quarterly or whenever the client needs it.
“We realised over time that our clients will be better served by employing experts, so in effect we’ve outsourced that part of the job. It’s not where our expertise lies,” he said.
Lillis said there may also be another benefits from the deal. "We hope that aligning ourselves with quality firms such as Brooks Macdonald will help us in our focus on recruiting experienced and qualified staff to support our continued business growth."