Nedcor Retail Investments today announced the acquisition of boutique unit trust company African Harvest Management Company Ltd.
African Harvest Management Company offers a suite of ten unit trusts covering the growth, value and fixed-interest investment management styles. Assets under management are currently in excess of R1.2 billion.
Dave Macready, head of Nedcor Retail Investments says: "The acquisition of African Harvest Management Company adds significantly to the scale of assets under management of Nedcor Retail Investments' unit trust operations. In today's economic and investment climate unit trust companies need substantial assets under management, as well as access to distribution and top-performing fund managers to ensure profitability. Nedcor Retail Investments, as the provider of retail investment solutions to the Nedcor group and independent financial advisors has the necessary distribution. Our strategy to outsource the asset management of our funds on a "best of breed" basis ensures we can appoint investment specialists, either within the wider Nedcor group, or to third-party asset managers who have proven, consistent performance track records. This outsourced asset management strategy is already reaping benefits for our investors. Now, with this acquisition we have grown our assets under management significantly."
Rowan Williams-Short, managing director of African Harvest Fund Managers welcomed the announcement: "We're thrilled that we have been able to conclude this important transaction. It allows African Harvest Fund Managers to focus on what we do best, namely third-party portfolio management. This service will continue to be offered to both the institutional and the retail markets, but we will leave the distribution of retail investment products in the capable hands of Nedcor Retail Investments, to whom we have granted certain exclusivities."
Both Williams-Short and Macready stressed that African Harvest Management Company unitholders will continue to receive the quality client service and superior investment management that they have come to rely on. Importantly, both the Nedcor Retail Investments' unit trust operations and the African Harvest Management Company make use of outsourced unit trust administration service provider Finsource, to provide client administration. This will ensure a seamless transfer of client servicing to Nedcor Retail Investments.
African Harvest Fund Managers will also continue to manage the assets of the African Harvest unit trust funds, as well as the funds within the Nedcor Retail Investments stable that have been outsourced to them. This transaction, coupled with the outsourced asset management agreement is very much a partnership, which will benefit both parties and their respective unitholders.
Nedcor Retail Investments are well advanced in the planning phase of the rationalisation of certain of the funds across the four existing unit trust management companies in the group, namely Nedbank, BoE, NIBi and FT NIB Unit Trusts to ensure a comprehensive yet simplified competitive client offering.
Says Macready: "We will include the ten African Harvest unit trust funds in the amalgamation process, to ensure that the range of funds we offer addresses the changing needs of investors and is an appropriate mix of the different risk profiles of our investors. The best interests of our investors are paramount. Should any merging of funds be proposed, investors will have the opportunity to vote in favour of or against the proposals.
"By way of example, Tim Allsop of African Harvest Fund Managers now manages both the FT NIB Prime Select Fund and the African Harvest Rainmaker Equity Fund. Tim has already begun the process of aligning the underlying investments in both these portfolios, and it is likely that we will propose to merge these two funds."
Concludes Macready: "This announcement reinforces Nedcor's commitment to the retail investment marketplace. Nedcor Retail Investments is creating a unit trust operation, which has a significant retail investments' footprint, now with client assets under management of R7 billion. Our strategic intention is to concentrate on the retail investments market through increased emphasis on distribution, improved investment performance and the development of quality investment products, as is evidenced from this and our preceding announcements."
The acquisition of African Harvest Management Company Limited by Nedcor Retail Investments is subject to the required regulatory approvals.
This page was updated on 5 May, 2006
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