Vanguard has awarded a US$3.4 billion mandate to a boutique fund manager, replacing Franklin Templeton subsidiary Edinburgh Partners.
Sprucegrove Investment Management will manage about 35% of the Vanguard International Value Fund, which has US$9.8 billion in assets under management.
Lazard Asset Management and ARGA Investment Management are co-managers of the fund, which invests in global companies from developed and emerging markets viewed as temporarily undervalued.
The US-domiciled fund's expense ratio is expected to increase one basis point to 0.38%.
|Sponsored by BlackRock|
Looking to build resilience into your portfolio?
The head of Vanguard's portfolio review department Kaitlyn Caughlin said: "Vanguard has decades of experience in selecting and partnering with active managers. We continuously search for world-class investment talent that brings a particular expertise and experience to specific mandates."
Vanguard has some US$1.6 trillion in active assets and manages US$6.6 trillion globally.
Toronto-based boutique asset manager Sprucegrove employs a value-investment strategy and has US$13.8 billion in AUM. Arjun Kumar and Shirley Woo will co-manage Sprucegrove's portion of the fund.
Franklin Templeton acquired Scottish fund manager Edinburgh Partners on 1 May 2018.
Edinburgh Partners was co-founded by Sandy Nairn, who became chair of the Templeton Global Equity Group after the acquisition.