Former emerging portfolio managers from Stewart Investors and Fidelity have launched London-based, emerging markets specialist boutique Aikya Investment Management, Investment Week can reveal.
Launching with a flagship Global Emerging Markets absolute return strategy, Aikya has backing from minority equity partner Pinnacle Investment Management, which will provide non-investment support functions to the firm.
Pinnacle CEO Ian Macoun told Investment Week in June 2019 that the group was in talks to acquire stakes in UK and European boutiques with the firm set to build out its business across the continent.
Commenting on the launch, Macoun said Pinnacle, which now has £20.6bn in AUM across 15 affiliates, had made "great in-roads into the European marketplace", and described its first European-based affiliate investment manager as a "natural fit".
He added: "We have immense confidence in the capabilities of Aikya's esteemed investment team."
The founding members of Aikya, which means "oneness" in Sanskrit, will control a majority stake in the business, while Pinnacle will hold a significant minority stake, Investment Week understands.
Based in Victoria, Aikya IM is co-founded by former lead portfolio manager on several Stewart emerging market and Asia Pacific strategies Ashish Swarup, who is joined by former co-manager on a number of those funds Tom Allen.
Portfolio manager Swarup, who resigned from Stewart Investors last year, is also joined by former colleagues at the firm, investment analysts Alan Nesbit, Alex Khosla and Michael Summers, who will also serve as head of dealing.
Other founding members of the firm are former portfolio manager for the Fidelity Emerging Markets All Cap Strategy Rahul Desai, who will serve as portfolio manager and analyst at Aikya, and former senior analyst at Income Partners Asset Management Trevor Fung.
Desai was assistant portfolio manager to Swarup on the Fidelity Emerging Markets All Cap Strategy for four years before taking over as lead manager in 2014.
'A sense of purpose'
The Aikya Global Emerging Markets strategy will be a concentrated portfolio of 30 to 35 names, with a focus on buying "quality companies at sensible valuations", with a particular focus on investee company executive stewardship quality, franchise quality and quality of financials, the firm said.
Guided by ESG criteria, the portfolio is designed with a view to limiting downside risk, while generating long-term returns.
Specifically, the firm will not invest in companies with; "limited or negative social utility", such as coal, tobacco, defence and casinos, a history of human rights abuse, or poor capital discipline.
The fund will also not invest in companies with "misaligned" management teams, poor governance, or ones with major shareholders with political connections.