Franklin Resources, which operates as Franklin Templeton Investments, has acquired the remaining 80 per cent stake of alternative investments specialist Pelagos Capital Management, LLC, to become a 100 per cent equity stakeholder. Franklin Templeton acquired its initial 20 per cent equity stake in Pelagos in 2010.
William Yun, CFA, executive vice president, Franklin Templeton Alternative Strategies, says: “We’ve developed a strong relationship with Pelagos since our initial investment in 2010 and after seeing growing interest from investors in alternative investment strategies, we are pleased to announce the completion of this acquisition.”
Yun says: “The continued expansion of Franklin Templeton’s alternatives and solutions platform has been a core strategic initiative for our business. The completion of the Pelagos acquisition represents an important step in our efforts to create new investment strategies and broaden our offerings across multiple distribution channels.”
“Franklin Templeton’s extensive global platform, product development expertise and established distribution network has helped bring Pelagos’ investment strategies to investors worldwide,” says Stephen Burke, CEO of Pelagos Capital. “We look forward to continue growing this relationship as a wholly-owned subsidiary.”
Pelagos, an independent investment advisor founded in 2005 by Stephen Burke and John Pickart, is based in Boston, MA. Pelagos’ mission is to create alternative investment solutions that seek to enhance overall returns and lower portfolio volatility. Pelagos manages three distinct alternative investment capabilities including a commodity strategy, a managed futures strategy, and a hedge fund replication strategy. The Pelagos team implements an investment process highlighted by a top-down approach to global macroeconomics, quantitative focused models based on fundamental analysis, disciplined multi-level risk controls, and institutional-quality implementation and transparency.
Pelagos’ commodities and managed futures strategies are currently available as underlying investments within the Franklin Templeton Multi-Asset Real Return Fund, the Franklin Templeton Allocator Fund Series (Conservative, Moderate, Growth), and Franklin LifeSmart™ Retirement Target Funds, all of which are managed by Franklin Templeton Multi-Asset Strategies.
Franklin Templeton Alternative Strategies oversees the company’s specialised and alternative investment businesses globally. In addition to Pelagos, these businesses include:
- the multi-asset strategies and customized portfolios of Franklin Templeton Multi-Asset Strategies;
- the integrated hedge fund product solutions of K2 Advisors, in which Franklin Templeton holds a majority stake;
- the emerging markets private equity and mezzanine finance capabilities of Darby Private Equity;
- the global property and real asset offerings of Franklin Templeton Real Asset Advisors; and
- the company’s asset management joint ventures in China and Vietnam.