Invesco ends fight over fees with investment trust

Invesco Perpetual has resolved its recent corporate governance dispute with its trust Invesco Perpetual Enhanced Income.

In a stock exchange announcement this morning, Invesco Perpetual Enhanced Income says it has reappointed Invesco as the manager on a revised management fee basis in a deal reflecting the previously agreed arrangements between the parties.

The news comes two months after Invesco unexpectedly resigned from the mandate over a dispute around fees, kick-starting a war of words between the manager and the trust.

The management fee will now be 80bps on the first £80m of net asset value, 70bps on the following £70m and 60bps thereafter.

The existing performance fee arrangements will be removed and the notice period reduced to 3 months. These new arrangements will take effect immediately and will be deemed to have been effective from 1 January 2018.

The trust’s extraordinary general meeting to debate the mandate will still go ahead on 20 July 2018.

The trust says chairman Donald Adamson is stepping down with immediate effect. Management engagement committee chairman Richard Williams will also stand down.

Chairman of the audit committee Peter Yates will lead the board in the interim.

Brewin Dolphin head of research Guy Foster says he is relieved that a sensible resolution has been found.

He says: “The ultimate objective of a reduction in fees has been achieved and shareholders will benefit while the independence of the board has been preserved.

“We assume both departing board members will be replaced with an eye to replacing the fixed income expertise lost whilst also taking the opportunity to bolster board diversity”.

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