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Franklin Templeton expands product offering in South Africa

Templeton Africa Fund and Templeton Global Aggregate Investment Grade Bond Fund registered with FSB, widening the range of offshore products available to South African investors


Franklin Templeton Investments is pleased to announce that the Templeton Africa Fund and Templeton Global Aggregate Investment Grade Bond Fund, both sub-funds of its Luxembourg-registered SICAV range, Franklin Templeton Investment Funds (FTIF), have received approval for distribution in South Africa from the Financial Services Board (FSB). These new registrations bring the total number of funds offered by Franklin Templeton in South Africa to 41, and provide additional offshore investment opportunities across equity and fixed income sectors for investors looking to diversify their portfolios.


The Templeton Africa Fund was launched in May 2012, and is managed by Dr. Mark Mobius, executive chairman of Templeton Emerging Markets Group. It seeks long-term capital growth by investing in equity securities in African countries or in companies based elsewhere but who have their principal business activities in Africa. It is Dr. Mobius’ and the team’s conviction that African markets represent some of the most compelling and exciting growth opportunities over the long term. The Fund offers investors a diversified portfolio of companies across countries and sectors, enabling them to access the rapid growth taking place across the African continent. Its geographic weightings include Nigeria (32%), Egypt (12%) and Kenya (9%)with significant exposure also to Zimbabwe, Senegal, Mauritius and Botswana. The Fund also has exposure to selected South African (28%)companiesthat have operations or investments elsewhere on the continent.


Rising incomes and middle class expansion in many African countries have resulted in increasing demand for consumer products, leading to a positive outlook in earnings for consumer products companies such as automobiles and retailing, as well as services in finance, banking and telecommunications. The banking industry is important in this context, not only because of the rise of microfinance, but because of the growth of banks and their move into consumer banking. The Fund’s largest sector weightings includeFinancials (38%), Consumer Staples (26%) and Telecommunication Services (11%).


The Templeton Global Aggregate Investment Grade Bond Fund was launched in June 2012, and is managed by London-based John Beck and David Zahn, senior vice presidents and portfolio managers with Franklin Templeton Fixed Income Group. With a value-driven investment approach, this Fund actively pursues diversified sources of alpha across global markets, sectors and securities, seeking to exploit market inefficiencies though top-down allocations and bottom-up security selection on a tactical, strategic basis.

John Beck said: “Looking at the continuing downward trend of previously highly rated debt markets, a number of developing countries and their companies have gained investment grade status which presents investors with good opportunities in global interest rate, corporate and currency markets.


The team draws on the expertise of the Franklin Templeton Fixed Income Group, a global fixed income platform with more than 30 years’ experience managing multi-sector and single-sector investment strategies.


Jo-Anne Bailey, Country Manager, Africa at Franklin Templeton Investments, said:

The registration of these funds marks an important step for us in bringing South African investors a wide range of offshore products to match their investment needs, and underlines our commitment to the South African market. We are seeing a growing realisation amongst our clients of the benefits of investing offshore: greater diversification, access to interest rate opportunities and currency markets, exposure to a wider selection of asset classes and sectors, and the potential to benefit from attractive valuations and faster growth. We believe these funds will help us meet this growing demand.

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