View more on these topics

The big spring clean

Chris Salih on changes at Henderson as the fund firm rationalises its range after the New Star buy

Henderson unveiled the latest fund mergers last week after buying New Star in 2009.

The move will see Henderson merge five funds into others and make changes to fund names and policies in a bid to provide a comprehensive product range.

It marks an exceptionally busy 12 months for the company. It has kept a number of the big names from New Star, such as Richard Pease and the multi-manager pairing of Mark Harris and Craig Heron but there have been high-profile departures of Guy de Blonay, who left for rival fund manager Jupiter Asset Management, and Tim Steer, who opted to join Artemis before the deal’s conclusion.

Henderson chief executive Andrew Formica pointed to a number of advantages at the time of the £115m deal. Among them was the plan to make Henderson one of the leading players in the retail market in terms of assets.

Mark Skinner, head of retail distribution at the company, says there has been a lot to do following the acquisition and that plans for the future are well on track. He adds that he is happy with manager retention.

He says: “You get a great sense of cohesion when you see the fund managers working together in their teams and I think the stable nvironment here at Henderson has definitely helped those New Star managers.

“Inevitably, there is staff turnover but I am confident we have a highly experienced and stable team.”

Hargreaves Lansdown investment manager Ben Yearsley says that, in hindsight, Henderson has done extremely well.

He says: “They have kept the people they wanted to keep, such as European fund manager Richard Pease, and they also acquired the business at an exceptionally good price. Many would have questioned it 12 months ago but it has turned out to be very a good decision.”

Performance has been strong in the past year with 15 of the firm’s 33 funds recording top-quartile returns, according to figures from Morningstar. Only four funds produced fourth-quartile performance.

Chelsea Financial Services managing director Darius McDermott says: “We have always held Richard Pease’s fund in high regard while we are also supportive of the fixed-income pairing of John Pattullo and Jenna Barnard.

“Stephen Peak, who took on the UK alpha fund from Tim Steer, is also producing strong returns – the fund is up 50 per cent – while the technology fund is one of the flagship ones in the sector.”

Yearsley says: “The firm is strong in Europe, particularly in the bond sector. The one area I guess they may need to look at is the UK and I am not sure they have all the answers to that in house.”

’The stable environment here at Henderson has definitely helped those New Star managers’

Another decision since the deal is to do away with the Henderson New Star name. Skinner says the group was keen to keep the name as a signpost for advisers and their clients over the transitional period but it always had the intention to get rid of it at some stage.

The rationalisation of the range began after the Henderson and New Star funds were placed on the same admin platform.

Within the UK range, the group is planning to merge the growth and income fund into the higher-income fund, which will continue to be managed by Graham Kitchen and Andy Jones.

The UK growth fund, managed by Trevor Green, will merge into UK alpha to be run by Stephen Peak. UK extra income, managed by Job Curtis, will be merged into the managed distribution fund and has been given sophisticated Ucits powers. The fund will continue to be managed by Pattullo, Barnard and Trevor Green.

Henderson also plans to merge two of its multi-manager portfolios, with the cautious unit trust range managed by Heron merging into the multi-manager income and growth fund run by Bill McQuaker.

McQuaker’s multi-manager growth fund will merge into the Henderson active portfolio run by Harris and Heron. The fund will change its name to the Henderson multi-manager active fund.

The company has also renamed three multi-manager and four fixed-interest funds, the latter have also been given wider Ucits powers. The global equity fund has changed its name and objective.

Henderson head of product development Stewart Cazier says: “The big work has been done and it is now a case of one entity and business as normal. We will work out where we stand, where we want to launch new products, see if there are any further overlaps and tackle possible options on the back of the retail distribution review.”

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment