Kenanga acquires i-VCAP ETF business
KUALA LUMPUR: Kenanga Investment Bank Bhd (Kenanga Investment Bank) yesterday announced its acquisition of iVCAP Management Sdn Bhd (i-VCAP) via Kenanga Investors Bhd (KIB), its fully owned subsidiary, following approval by the Securities Commission of Malaysia.
i-VCAP is an award-winning, syariah-compliant investment management services provider primarily focused on Islamic exchange-traded funds (ETFs).
“We are constantly exploring ways to deliver new investment solutions for our clients. This is a natural step in our strategy to develop products for a wider audience. The ETFs market is one of the fastest growing segments in asset management.
“A number of long-term macro trends, including the increasing use of passive vehicles and the driving force of digitalisation will lead to a growing demand for ETF products,” said Datuk Chay Wai Leong, group managing director of Kenanga Investment Bank.
“The acquisition further expands our ability to build better, more diversified portfolios through our product capabilities across the Group, and enhances the range of solutions available. This addition strengthens our competitive edge in addressing client needs, which will further accelerate the growth of our business.”
The deal represents the financial group’s second bolt-on purchase of an asset management business within the last 14 months, following the acquisition of Libra Invest Berhad at end 2019.
In recent months and years, the group has been actively participating in joint ventures, acquisition exercises as well as strategic stakes within synergistic businesses. These are expected to complement its various business lines with recent results positively reflected in the group’s strong financial performance in 2020.
The acquisition represents swift progression one year after Kenanga Group’s first foray into the ETF space where OneETF by Kenanga, Malaysia’s first KLCIlinked leveraged and inverse ETFs was introduced together with its strategic partner Yuanta Securities, the largest ETFs provider in Taiwan and a leading ETFs provider in Asia.
Chief executive officer of KIB, Ismitz Matthew De Alwis says, “i-VCAP’s ETFs business is highly complementary to OneETF by Kenanga as we foresee that it will broaden our geographical reach, product suite and investment expertise, enabling us to provide more solutions to help clients achieve their investment objectives.
“The exercise adds depth to the company’s ETFs and Islamic product offerings as well as accessibility to the US market. Simultaneously, KIB is set to leverage upon this opportunity to further build on its existing ETFs business with a higher degree of economic scale for a more diverse range of ETFs by working with its partners, regulators and other service providers to drive the ETFs and Islamic capital market.”