AlTi Global Inc. has agreed to buy Singaporean money manager AL Wealth Partners, joining the rush of firms tapping the rapid rise of wealthy families in the city-state and across Southeast Asia.
The deal, whose value and terms weren’t disclosed, comes amid a surge in the number of multi-family offices in Singapore as more of the ultra-rich are lured by low taxes and relative stability. Industry experts estimate there are about 1,400 family offices in the city-state.
“The opportunity set for us is to be the only non-bank global wealth service for large families,” said Robert Weeber, AlTi’s president of international wealth management.
AlTi was formed in January through a SPAC deal that combined Alvarium Investments and Tiedemann Wealth Management Holdings. The company had about US$65 billion ($87.08 billion) in assets under management or advisory as of December.
As part of the acquisition, AL Wealth’s co-founders Anthonia Hui and Leonardo Drago will join AlTi’s international wealth management business as head of Singapore and head of Singapore investments, respectively.
Southeast Asia Growth
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For Weeber, the acquisition gives the firm a foothold and local staff in a rapidly growing market for wealthy families - even though the firm already has a presence in Hong Kong. In exchange, AL Wealth’s clients get access to the broader company’s deals, services and expertise from around the world in areas like impact investing. Drago said the business had a little over US$1 billion in assets under management before the deal.
“We see Southeast Asia as an enormous opportunity over the next 10 to 15 years,” Weeber said, predicting the UK, Switzerland, along with Hong Kong, Singapore and Southeast Asia to be the biggest areas of non-US growth over the next five years. “The expectations are high.”
The deal comes ahead of an expected consolidation of family offices as operating costs rise and staff become harder to keep - especially at smaller, first-generation single-family offices where job satisfaction can be harder to achieve.
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Consolidation Coming
“There are a lot of external asset managers, multi-family offices with 30, 40, 50 people that I have seen and it’s very difficult to run such a business unless the AUM is significant,” Drago said. “There are too many asset managers and too many small family offices and the costs have gone up significantly so I don’t doubt that there will be consolidation in all of Asia.”
Singapore, whose unemployment rate in March fell to an eight-year low of 1.8%, has been steadily increasing the number of locals that ultra-wealthy emigres and single-family offices must hire in order to get tax exemptions and residency benefits. Rising rents and cost of living concerns are also making it pricier for would-be expatriates without wage or allowance increases.
Associate Professor Marleen Dieleman, an expert on family business at the NUS Business School, said Singapore is still in the growth stage of family offices characterized by the entry of new players.
“Undoubtedly this will be followed by a maturity stage, which then means there’s a shakeup,” Dieleman said, adding that it hasn’t happened yet. “If the influx of more wealth into Singapore tapers off and the number of players gets more competitive, that’s the moment when we’ll see consolidation.”
