What's exciting Gervais Williams?

Diverse Income Trust manager Gervais Williams says he is getting 'excited' about smaller companies striking 'transformational' deals.

Despite smaller companies enjoying  a strong run of late, Williams believes there are still opportunities for healthy returns.

In particular, he is looking out for companies keen to agree deals that can take their business to a new level.

Williams said: 'One of the areas we get excited about is smaller companies able to do transformational deals, such as Silverdell.  It was originally involved in asbestos removal but did a deal with a Canadian firm involved in more general decommissioning, so it became more international and can take on bigger jobs.

'Between them, they can make some really good growth in the market and become a dominant player.'

Elsewhere, Williams is also looking forward to the eventual intergradation of Henderson Fledgling Trust with Diverse Income, which he resumed control of in February following a strategic review.

The move sees Williams return to the trust which he managed for 10 years from 2001 while working at Gartmore.

Williams said: 'The nice thing about the trust is that there are a lot of good stocks in the portfolio which seem a good fit with Diverse Income's holdings already, and in time as the fund becomes more similar to the Diverse Income Trust, then of course we have the opportunity of a merger.

He added: 'It's an opportunity to deliver a lot of value to those shareholders and to become part of a bigger trust.'

A merger of the two vehicles has already been given the green light by key shareholders M&G Investment Management and AXA Investment Managers, which own 40.9% and 14.3% of the trust respectively.