July 27, 2009 / 6:36 AM / 10 years ago

UPDATE 3-Aberdeen plays down U.S. move as outflows slow

* Q3 net redemptions 2.2 bln stg vs 4.2 bln in Q2

* Credit Suisse buy boosts assets to 129.2 bln stg

* Job losses total 250-300, a few more expected

(Adds details, CEO and analyst comments)

By Cecilia Valente

LONDON, July 27 (Reuters) - British fund firm Aberdeen Asset Management ADN.L ruled out a U.S. acquisition in the short term as it said on Monday net outflows of client money slowed in the third quarter.

Net redemptions from funds totalled 2.2 billion pounds ($3.64 billion) at end-June after hitting 4.23 billion at end-March. Equities saw inflows, while fixed income contributed the bulk of outflows.

The company has been trying to position itself as a major global funds player, exploiting low valuations to seek acquisitions, but Gilbert ruled out a deal in the United States in the short term.

He said Aberdeen was “definitely not pursuing” a deal to buy U.S. funds group Delaware. Chief Financial Officer Bill Rattray said: “There is nothing at the moment, nothing happening. We think it is gone to someone else.”

Australia’s Macquarie (MQG.AX) has been reported to be the frontrunner for Delaware.

Gilbert said Aberdeen was looking for U.S. deals in the mid- to long-term, especially to improve its fund distribution.

“It is not something we are pursuing aggressively,” he said.

Last month, Gilbert had highlighted opportunities as U.S. owners of assets managers sought to strengthen balance sheets, and predicted “pretty intense” activity [ID:nLP901359].

Despite continuing outflows, assets under management at end-June grew to 129.2 billion pounds from 96.3 billion at end-March, boosted by the acquisition of 35.3 billion pounds in assets via the purchase of Credit Suisse’s UK business.

Market gains added another 9 billion pounds to assets.

SHARES PARE GAINS

At 0825 GMT, Aberdeen’s shares had pared early gains to trade up 0.18 percent at 137.75 pence, while the FTSE 100 share index was up 0.05 percent. Broker Evolution Securities raised its rating to Neutral from Reduce, while other brokers kept their ratings and called the trading statement broadly in line.

The fixed income business saw outflows slow sharply during the quarter to a net 2.71 billion pounds, against outflows of 4.23 billion in the previous quarter, helped by outperformance in the company’s funds.

Equities funds saw net inflows of 1.58 billion pounds, a sharp gain from 245 million pounds in net inflows last quarter.

The company also highlighted a 1.4 billion euro property mandate from a Swedish client, for which they will receive the funds in January 2010. Net outflows in the property business were 140 million pounds, flat against the last quarter.

Since embarking on a cost-cutting programme in the wake of the credit crisis, Aberdeen has shed 250 to 300 employees — some 12 percent of its workforce — mostly in the real estate division, said Rattray.

“There will be a little more, there is always a bit of tidying —a lot of it is tidying up for instance temporary employees,” Rattray said.

Aberdeen expects the real estate division, which in the first half posted operating margins of around 13 percent, to hit a margin in the "mid-twenties" in the medium term. ($1=.6049 POUND) (For the Hedge Hub blog, visit: blogs.reuters.com/hedgehub/ For the Global Investing blog, visit: here) (Reporting by Cecilia Valente, Editing by Joel Dimmock and Simon Jessop)

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