Alliance Trust Investments (ATI) has acquired Aviva Investors’ Sustainable and Responsible Investment (SRI) funds business in a £1 million deal.
The division runs some £1.2 billion in funds and the deal will be completed by 31 August. Five members of the Aviva Investors SRI investment team, including head Peter Michaelis, will transfer to ATI's London office to set up an SRI proposition for the firm.
It is intended that the seven-strong SRI Oeic fund range will transfer to ATI in early 2013 subject to legal and regulatory approval. The range also includes a Luxembourg fund, for which Aviva Investors is considering the long-term future.
The news comes as Aviva Investors scales back its asset management business to focus on areas where if believes it has a competitive edge. This includes fixed income, multi-asset solutions, real estate and core equities.
Aviva Investor's interim chief executive Paul Abberley said: 'This is a good outcome for our clients and also our business. The transfer of our SRI team to Alliance Trust Investments will facilitate a seamless transition of responsibilities and ensure consistency is maintained in the investment process.
ATI managing director Ed Troughton added: 'Securing this highly respected SRI team led by Peter Michaelis underlines our future growth strategy of focusing on global equities and fixed income with an emphasis on specialist investment opportunities.
''The skill set of the SRI team perfectly complements our current approach in both global equities and fixed income. These three core parts of our business will now allow us to design tailored, specialist, investment solutions for our clients – both at the fund and segregated level. This announcement marks the next stage in our development and will help accelerate our path to profitability.'
Alliance Trust restructure
The news was accompanied with a half year update from Alliance Trust, which is undergoing a major restructure.
In the six months to the end of June the total return of the investment company’s net asset value was 5.5% per share, which was broadly in line with the sector average, with the fund ranked 13 out of 33 in its peer group over the last six months.
The restructure of the portfolio will see the trust run on a ‘truly global basis’. The company recruited Ilario Di Bon to facilitate the process, which is expected to deliver annualised cost savings of £2 million following a one-off re-organisation cost of £1 million.
As part of the restructure the number of stocks in the fund will be slashed from 200 to 100.
Commenting on the numbers, Alliance Trust chief executive Katherine Garrett-Cox (pictured) said: 'Alliance Trust has delivered another positive set of results and we are reporting good progress across all parts of the organisation.
'We have built a further six month period of strong performance in volatile markets on the back of what we delivered in 2011. Our NAV continues to outperform the global growth sector and illustrates that our priority is to produce consistent returns for our shareholders.'