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Liontrust plans raft of fund changes

Liontrust is planning to merge its first large cap fund amid a raft of changes at the asset manager.

The group has asked for investors to support the merger of the fund, which is managed by Gary West and James Inglis-Jones, into the £116m first growth fund, managed by Anthony Cross and Julian Fosh.

Liontrust says both funds have a similar mandate, however the first large cap fund has a restricted remit to invest in companies within the FTSE 350. Liontrust also raises concerns about the efficiency of the first large cap fund, claiming a merger is likely to see the total expense ratio fall.

Liontrust also plans to rename the first growth fund as UK growth amid a raft of name changes across its range. Liontrust intellectual capital trust will be rebranded as UK smaller companies, first opportunities will become special situations, continental Europe becomes European growth and the first income fund will be rebranded as the Liontrust income fund.

The funds will also be seeking wider investment powers of Ucits III which the group says will permit the use of investment techniques which have been unavailable to the group in the past. Liontrust says the introduction of these powers will see a rise in the total expense ratios across the range of funds.

Liontrust estimates the largest increase in total expense ratios as a result of introducing wider powers will be on the Liontrust first opps fund, from 1.93 to 2.12 per cent, and the Liontrust continental Europe fund, 1.66 to 1.76 per cent.

The proposals follow Liontrust Fund Partners LLP becoming manager of the funds in place of Liontrust Investment Funds. The move has been approved by the FSA and follows a reorganisation of the business in July 2010.

The proposals for renaming the funds and introducing wider powers will be made at an extraordinary general meeting on September 28, 2010, while the merger of first large cap into first growth, if approved, will take place on 30 September.

At the start of 2009 the Liontrust first growth fund and first income funds were being managed by investment director Jeremy Lang. William Pattisson, another star manager at the group, was running the Liontrust first large cap and focus 350 funds.

However on January 13 the duo resigned triggering a 33 per cent fall in Liontrust’s share price in a single day and contributing to group-wide fund outflows that took its assets from about £3bn then to closer to £1bn today.

In May this year the group’s founder and chief executive Nigel Legge resigned, handing over to head of retail John Ions in a process that completed on August 6.

A strategic review resulted in the axing of the global equity fund team led by Ross Hollyman. Legge had hired the team just six months previously but it did not launch any funds.


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There is one comment at the moment, we would love to hear your opinion too.

  1. Titanic and deckchairs spring to mind. I used to recommend First Income, but it went badly off the boil and seems to have recovered only over the past year. It’ll take a good few years, I fancy, for LionTrust to regain its credibility as a leading investment house.

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