Alliance Trust calls extraordinary general meeting over radical restructure plans

Eight new managers are to have responsibility for investing the group’s £3.3 billion of funds as a result of the radical shake-up which comes after a year of upheaval at the Trust that saw its former senior management team led by then chief executive Katherine Garrett-Cox ousted by activist investors over corporate governance issues and underperformance.

The new regime will see new managers – three to be located in London, four in America and one in Canada – overseeing between £400m and £500m of the Trust’s cash.

They will report into Craig Baker, the chief investment officer of new investment manager Willis Towers Watson, and his co-portfolio managers David Shapiro and Mark Davis.

Last month the Trust acknowledged that the new structure will be more expensive to operate but claimed this is hoped to be offset by improved investment returns, with new managers set a target to outperform the MSCI All Country World Index by 2 per cent per annum, meaning a doubling of the previous 1 per cent target.

The Trust has also reconfirmed its commitment to its existing progressive dividend policy and ensuring the 49-year run of improved dividend payments is maintained.

Chairman Lord Smith of Kelvin, said: “Under the new approach, Alliance Trust will offer access to best-in-class managers, which, together with a focus on only their best investment ideas, will help to increase the likelihood of consistently delivering improve performance over the long term.”

The new rosters of managers are: Bill Kanko of Black Creek Investment Management of Toronto, Pierre Py and Greg Harr of Los Angeles-based First Pacific Advisors, Rajiv Jain of GQG Partners of Fort Lauderdale, Ben Whitmore of Jupiter Asset Management in London, Andrew Wellington of Lyrical Asset Management of New York, Hugh Sergeant of London’s River and Mercantile Asset Management George Fraise, Gordon Marchand and Rob Rohn of Sustainable Growth Advisers of Stamford, Connecticut and Andy Headley of Veritas Asset Management of London.

The changes will be discussed at a general meeting of the company to be held on February 28.

Last month the Trust also announced plans to sell off its in-house asset management operation ATI and outsource the service.