River UK Micro Cap (RMMC) has chosen to remain under the management of Liontrust, following a board review of management arrangements.
The review has established that there will be no change in the trust’s investment objective and policy, while the investment style will also be unchanged, with active management maintaining the current “lifecycle framework and quantitative analysis”.
This means that the fund’s central objective – capital return – will continue. The review noted that steps towards this goal have been achieved over the last year, delivering a total return of 22.4% and share buybacks of £4.2m.
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Liontrust has also appointed new fund managers. Anthony Cross and Hugh Sergeant were selected for leadership, supported by a team of seven analysts, following the departure of George Ensor and Mayan Uthayakumar earlier this year.
A marketing campaign has also been agreed with the aim of attracting new investors.
John Blowers, chair of RMMC, said “Liontrust has committed to using its expertise and resources to initiate a substantial marketing campaign to expand and diversify the shareholder base and manage the discount downward.”
However, management fees will be slashed to 0.35%, down from 0.75%. The performance fee will continue, however, with the intention of lowering costs and aligning the interests of the investment manager and shareholders, according to the firm.
John Ions, CEO of Liontrust, said: “We appreciate the confidence of the board of RMMC in being reappointed and the responsibility of delivering for shareholders. We are committed to providing the investment management, marketing, sales and resources to ensure the success of the company.”
Blowers said: “The board has spent the last few weeks assessing the significant number of approaches it received, shortlisting and interviewing portfolio managers.
“The competitive process reflects the attractive opportunities offered by micro cap stocks in terms of growth potential and current valuations and validates the strategy.”
