The BHAM team will be joining Javelin as part of the transaction, and Justin Kendrick, the principal and founder of BHAM, will join Javelin as its new chief investment officer.
The acquisition has been in the works for almost six months, following the awarding to Javelin, last June, of a Capital Markets Services licence by the Monetary Authority of Singapore (MAS), Davies said. It will take effect in the first quarter of 2014.
The purchase price and other details of the transaction were not disclosed.
‘Differentiation’
Davies said he took the decision to expand Javelin and widen its product and service offering in order to better differentiate it from the Singaporean private banks and financial advisory businesses in Singapore that “remain heavily transaction-focused”.
It also comes at a time when many financial advisers in Singapore are re-visiting their business models in response to regulatory changes being brought in by the Monetary Authority of Singapore, through its Financial Advisory Industry Review. The changes are aimed at ensuring higher standards among advisers, greater transparency, and better tailoring of advice to suit individuals’ needs.
The CMS licence will permit Javelin, which was formerly licensed by the MAS as a financial adviser, to provide its clients with in-house discretionary asset management and fund management services, in addition to its existing advisory services. The new service offering is limited to ‘accredited investors’ whose net personal assets exceed S$2m (£977,000, $1.6m).
“In my view, many clients today are looking for a more integrated and activist wealth management offering, rather than a purely advisory role, from their advisers,” Davies, who is Javelin’s chief executive and largest shareholder, said.
“With our new licence, our clients can now choose between our existing advisory offering, or our new discretionary portfolio management service.”
Davies founded Javelin in 2004 to look after high net worth investors in Singapore, which was in the process of transforming itself into a regional wealth management hub. The decision to set up his own business was prompted, he says, by his receiving some particularly poor advice from an adviser, which helped him to see the potential market for the type of ethically sound and transparent advice that he had sought.
Javelin now has around US$80m in assets under advice, and around 72 individual clients. The acquisition of the BHAM funds and its team will increase firm assets in early 2014 to US$100m, with discussions on new mandates also ongoing, according to Davies.
