FRANCE - The 390,000 members of Nantes-based mutual pension provider UMR Corem will soon be able to invest in a range of African equity markets via London-based pan-African specialist Silk Invest, thanks to a change in the mandate of one its main underlying emerging market fund products.
The OFI Multi Select BRIC fund, a multi-manager product managed by Paris-based OFI Asset Management, is re-branding as “BRICA”, with the addition of Silk Invest alongside existing managers Charlemagne Capital and East Capital for Brazil and Russia, while F&C Investments and Lloyd George Management oversee investments in India and China.
UMR Corem is one of the major allocators to this strategy, with around €30m invested. Chief investment officer Vincent Ribuot told IPE that while the addition of an Africa manager was initially OFI Asset Management’s idea, the €7bn mutual was enthusiastic about the move.
“We need to think and invest globally,” he said. “It will mean more diversification and less reliance on the big emerging markets. It should mean more exposure to future growth from frontier markets.
“The BRICA concept is about enabling us, through OFI, to make some tactical decisions about whether to favour exposure to any of these five markets.”
UMR Corem already has substantial emerging markets exposure, including some frontier markets.
Its members’ equity allocations are made via two funds of funds, managed by UMR and advised by OFI Asset Management - UMR Select Europe and UMR Select OECD. About 8.3% of the Europe fund is allocated to emerging markets, and as much as 25% of the OECD fund - including around 1.6% in frontier markets. Of members’ overall equity exposure, about 4.1% is to emerging Europe and 13.5% is to Asia ex-Japan and the emerging world.
“It’s a long-term view for us,” said Ribuot. “We have exposure to emerging market equities, but also to developing-market companies that have a big part of their business from emerging markets.”
The Multi Select BRIC fund - which will become the BRICA fund - currently represents around 6% of the €550m UMR OECD Select fund, and is available to members of all four of UMR Corem’s individual pension plans - Corem, Corem Co, R1 and R3.
OFI Asset Management could not be reached for comment.