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Liontrust assets top £30bn as ESG funds climb above Cross & Fosh

Liontrust assets have topped £30bn as the group completed the purchase of multi-asset business Architas.

Liontrust assets top £30bn as ESG funds climb above Cross & Fosh

Liontrust assets have topped £30bn as the group completed the purchase of multi-asset business Architas and new client commitments of £792m over the final three months of the year.

That took total inflows for nine months of its financial year to £2.54bn the company said in a quarterly trading statement, up 83% over the period to end the year at £29.4bn.

Assets climbed further to break through the symbolic milestone in the first seven working days of the new year. While the accounting period is slightly flattered by the March crash, assets are nonetheless up 76% on the circa £17bn managed following its purchase of Neptune in late 2019.

In early trading Liontrust shares were 2.4% higher at £12.80.

Chief executive John Ions said: ‘I am incredibly proud of how the whole company continues to operate successfully, achieving our strategic objectives through the global pandemic

‘Following its acquisition at the end October 2020, the Architas UK investment business is now fully rebranded and integrated. The speed and efficiency of this could not have been achieved without clear vision and strong operational processes across the company’

Following a blockbuster year for ethical and sustainable strategies the company’s ESG assets have overtaken the economic advantage UK equity strategies managed by Citywire AA-rated Julian Fosh and Anthony Cross, which formerly heavily dominated the company’s income base.

The sustainable team, which joined from Alliance Trust in 2017 and which is headed by Citywire AAA-rated Peter Michealis and Simon Clements, had already seen its assets triple since then to £7.5bn in September last year.

Following further sustained growth, the team now manages £9.2bn versus the UK team’s £8.3bn.

Ions added: ‘Our sustainable investment team will have been successfully engaging with the companies they invest in for 20 years in February 2021.

‘Over the past two decades, the team have demonstrated the ability of their investment process to outperform mainstream funds and the impact of their funds on sustainable development.’

In mid-2018, the company admitted demand for its ESG strategy had been ‘significantly higher than [it] expected’.

The business added the ‘perception of corporate instability surrounding’ Alliance Trust and ‘to what extent it would suppress demand for ATI’s retails funds had not been fully considered’ and it had ‘not been fully aware of the increase in UK investment consumer demand for sustainable investments’.

FinnCap’s Nik Lysiuk noted that the company’s premium growth did not appear to be reflected in the recent trajectory of its share price.

‘Shares are off over 12% from the highs over the summer of 2020 and have been range bound since,’ he said.

‘I’d suggest this is an opportunity to own a quality business before the next leg of growth comes through and the acquisitions bed in. Who wouldn’t want to own a fund manager that has almost doubled assets over 12 months?

‘Liontrust offer a strong product and distribution mix tapping into the vitally important IFA sector and it’s all boosted by an acquisition strategy. When momentum in scale builds, it runs away with itself (at least in the growth phase).’

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