Franklin Templeton has been a strategic investor in Algebra Capital since 2007, acquiring its original 25% stake that year and increasing its stake to 40% in 2009.
Franklin Templeton believes that the MENA region, with a market capitalisation of $910bn (Source: Bloomberg, 5th June 2011) and a population of more than 300 million (Source: World Bank, September 2010), offers significant long term prospects for growth despite recent turmoil in the region.
“Franklin Templeton’s acquisition of Algebra Capital reinforces our commitment to the MENA region and to the growth of our local asset management capabilities globally,” said Andrew Ashton, FTIMEL’s chief executive officer.
“We are excited about our MENA equity, MENA fixed income, and Sukuk investment management capabilities and the ability to leverage Franklin Templeton’s expertise around the globe. Looking ahead, we will continue to develop and offer investment strategies where we see local, regional and global demand.” he added.
“The Middle East offers investors exposure to one of the fastest-growing economic blocs in the world driven by record government spending and high oil prices”, said Joe Kawkabani, FTIMEL’s chief investment officer – equities. “The region, mostly represented by the Gulf countries, boasts low debt, strong sovereign balance sheets, stable currencies and very attractive equity market valuations compared to other emerging markets. The region also represents an important portfolio diversification opportunity as it is relatively under-represented in global portfolios.”
Mohieddine (Dino) Kronfol, FTIMEL’s chief investment officer – fixed income and sukuk, added, “Annual MENA debt issuance regularly exceeds $200bn and is expected to increase further. In fact, MENA debt markets currently represent more than one third of the global Sukuk market and approximately $120bn in investable corporate issues. With large infrastructure and development spending committed, the prospects for increased primary market activity, secondary market depth and liquidity as well as developing local currency bond markets continue to improve, offering investors an attractive investment proposition,” concluded Kronfol.
FTIMEL is the most recent addition to Franklin Templeton’s wholly owned Local Asset Management business, which also includes local investment management teams in Brazil, Canada, India, Japan, Korea, and the UK as well as the company’s asset management joint ventures in Vietnam and China.
FTIMEL is a wholly owned company within Franklin Resources, Inc., a global investment management organization operating as Franklin Templeton Investments. Franklin Templeton Investments provides global and domestic investment management solutions managed by its Franklin, Templeton, Mutual Series, Fiduciary Trust, Darby and Bissett investment teams. The San Mateo, CA-based company has more than 60 years of investment experience and over $735bn in assets under management as of May 31, 2011.
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