Aberdeen Asset Management has agreed to acquire Flag Capital Management, a manager of private equity and real asset solutions with offices in Stamford CT, Boston, MA, and Hong Kong.

Flag will be integrated into Aberdeen's private markets operations. Through the acquisition, Aberdeen is continuing its strategy to grow its global alternatives platform and solutions. Flag’s established private equity teams in the US and Asia will help broaden Aberdeen’s private markets solutions activity within the alternatives arena. 

Martin Gilbert, chief executive of Aberdeen said the transaction would assist with accelerating Aberdeen's alternatives business growth in two ways:

"Initially, it strengthens further our private market capability by bringing additional Asian expertise and new US resource. This will also benefit our overall pan-alternatives platform. Secondly, Flag deepens and expands our US client base, which is a key growth market for Aberdeen.”

Flag is focused on venture capital and small to mid-cap private equity and real assets in the US, as well as private equity in Asia. It's AuM was approximately $6.3bn as at December 2014. 

After integration, Aberdeen's private equity business will total over 50 investment professionals and roughly $15bn of AuM. 

Aberdeen’s alternatives platform, overseen by Andrew McCaffery, global head of alternatives, will have total assets under management of $21.3bn following completion of the transaction. 

Peter Lawrence, chief executive of Flag said that there was a "clear cultural fit" between the two organisations: "Simply put, we can think of no better or more appropriate future for all involved."

"We believe the combination serves the interests of all of our constituents, particularly our limited partners and talented team of professionals."

The transaction is provisionally expected to close in Q3 2015 and is subject to regulatory approval from the Hong Kong Securities and Futures Commission (SFC) and submission of a Hart-Scott-Rodino filing with the US Department of Justice and the Federal Trade Commission.

Pakenham Partners served as financial advisers to Aberdeen on this transaction; Berkshire Capital served as financial advisors for Flag.