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Then there were three

Bidders for embattled asset manager New Star are believed to have narrowed this week with Schroders, Aberdeen and Henderson thought to be in pole position to win the race.

Earlier this month, New Star confirmed it had received a number of indicative proposals with respect to the company’s business, including a possible offer for its ordinary shares conditional on the proposed restructuring taking place.

Schroders, which has a strong cash surplus it thought to be a particularly strong contender and is reported to have tabled a bid of over £100m for the business.

The final deadline for bids came last Friday and UBS, which is leading the deal on behalf of New Star’s banking syndicate, is believed to be keen for a quick sale due to concerns over the continued outflows seen by the firm.
An issue which doesn’t appear to be so easily nipped in the bud involves former New Star fund manager Patrick Evershed who is reported to be taking legal action against the company following his dismissal last September.

Evershed, who previously ran the select opportunities fund is understood to be taking the firm to tribunal alleging constructive dismissal. He left the firm after significant underperformance over a three-year period, losing 31.9 per cent on the fund which fell to the bottom quartile of the UK all-companies sector.

According to reports, a hearing is scheduled for April, while procedural hearings on the case began last week.
In other investment news, Alliance Trust Asset Management is looking to add more weight to its recently-launched asset management operations with two to three more funds planned in the next 12 months.

On Monday, the firm announced the launch of its asset management business along with a UK equity income and North American equities offering.

Alliance Trust chief executive Katherine Garrett-Cox says the firm is likely to continue with these core themes for future launches with Europe looking particularly attractive.
She says: “We recently appointed Fiona MacRae who ran a large amount in pan-European equities for Kempen Capital Management, and that looks like an attractive area to add to this fund range.”

Global, Asian and emerging market equities are also hotspots for the firm who have in-house specialists in these areas.
Garrett-Cox says: “We feel this is a good time for the launch of a fund management business but are keen to stick to the core attractions that we feel people will invest in. However, we will look to add to our staff if the opportunity comes.”

Meanwhile, the KSFIoM depositors action group continue to press the Isle of Man government for answers over the crisis surrounding the Kaupthing Singer & Friedlander debarcle.
Attention has now turned to the roles played by the Kaupthing bank’s directors in this disaster. John Cashen is both deputy chairman for the Isle of Man’s Financial Supervision Commission and board member of KSFIoM. Many questions have been raised about how a board member of a bank could also have a senior post on the island’s financial services watchdog.

As well as seeking clarification on this, the KSFIoM group is calling for a loan from the Isle of Man government to help the bank repay depositors in full.

The action group has urged IoM government ministers to help fund part of the £550m gap currently facing depositors. It says: “The message to the IoM politicians is clear, do the right thing for islanders’ jobs and depositors’ money. Preserve the economy of the IOM and loan KSFIOM the money it needs to repay depositors in full. The alternative is unthinkable for all.”

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