Liontrust Asset Management is negotiating to buy rival fundhouse Neptune, founded by Robin Geffen.
In a statement to the stock exchange this morning (July 29) Liontrust confirmed that negotiations are underway.
But the firm added: "There can be no certainty that the discussions will lead to any agreement concerning the possible acquisition by Liontrust of Neptune or as to the timing or terms of any such agreement.
"There can also be no assurance that, even if reached, any such agreement will be completed."
The most recent set of accounts for Neptune, which cover the period to the end of 2017 and were filed in October 2018, show Assets Under Management (AUM) fell to £3.6bn, having been £3.7bn the previous year.
The firm was profitable in that year, making a profit of £994,000, having lost £62,000 in the previous year.
Increased profit in a year when assets under management fell happened as a result of cost cutting, with staff costs falling from £9.3m to £7.2m, and other costs falling from £10.5m to £9.8m.
Mr Geffen founded Neptune in 2002 and acts as both chief executive and fund manager.
There are multiple shareholders in the business, though Mr Geffen is the only one listed by companies house as being a person with significant control, as he has a stake of more than 25 per cent, but less than 50 per cent in the company.
Neptune has been blighted by staff exits in recent times, with head of sales director Dan Lee retiring after less than a year in the role, and fund manager Ali Unwin quitting as a US equity fund manager after just over a year. There have been five US equities managers in just over two years.
The firm’s European equity manager Rob Burnett, who managed about 10 per cent of Neptune’s assets under management in his European Opportunities fund, quit the firm in December 2018.
Mr Geffen recently attracted notice for promoting his son to co-fund manager on mandates run by Mr Geffen senior. The son had previously interned at the firm.
In its most recent update to market, Liontrust had assets under management of £14bn at the end of June 2019.
The company posted a profit of £19m for the year to the end of March 2019.
Asset growth has to a large extent been fuelled by the hiring of new managers to launch products in the bond space and the sustainable investment space.
FTAdviser understands there remain divergent views between the Neptune management and Liontrust about the final price for the transaction.
david.thorpe@ft.com
