Private equity firm Aureos Capital will move most of its operations out of London to a new Singapore office to skirt new European alternative investments regulation and higher U.K. taxes.
The new office will open in August. Five of the p.e. shop’s partners, including CEO Sivendran Vettivetpillai, plan to move to Singapore as soon as the end of this year.
“We don’t do any business in the U.K.; we sit here for legacy point,” Vettivetpillai told Bloomberg News. “For a global firm to function it doesn’t really matter where you are based, as long as you have the process systems in place for you to function appropriately and cost-effectively.”
While Vettivetpillai called the costs of doing business in London “exorbitant” and admitted Aureos was concerned about proposed European Union regulations, the move was also motive by the firm’s plan to shift its investment focus to Asia.
“There’s a commercial rush behind it,” he said.
Aureos currently invests half of its assets in Africa. But the firm, which is raising US$250 million for its South-East Asia Fund II, plans to pour US$1 billion into Asia over the next two-and-a-half years. According to Vettivetpillai, Asia will account for half of its assets under management over the next few years.
Aureos plans to hire five professionals for its Singapore hub over the next six months, with another five hires down the road. The firm will “thin down” its London operations “because the cost factor is getting out of hand.”
London won’t be the only loser with the opening of the office in Singapore, which beat out Dubai and Hong Kong for the honor. Aureos’ Sri Lanka-based portfolio manager will also relocate to the city-state.