Last checked at 18 Feb 2010 07:00
We have received notice of termination of the Investment Advisory Agreement between Analyst Investment Management plc ("AIM") and Capita Financial Managers Limited ("Capita") with effect from Wednesday 17 February 2010. Capita's ground for termination is that the investment strategy provided by AIM is not satisfactory. Capita regard this as a serious breach of the investment advisory agreement.
Capita have played no part in attracting investors to and/or investment management of CF Analyst UK Fund ("Fund"). Investors in the Fund are not personally known to Capita. The Fund pays substantial fees in excess of 1.61% of the Net Asset Value of the Fund to Capita for providing services as Authorised Corporate Director,("ACD").
AIM has been in discussions with Capita since December 2008 to replace Capita. In May 2009 at a meeting at Capita's offices it was agreed that Capita will use its best endeavours for a smooth transition from Capita to Marlborough Fund Managers Limited ("Marlborough"), the replacement ACD. Following the signing of an agreement with Marlborough as the replacement ACD a handover meeting was arranged. At a meeting in October 2009 at Capita's offices in the presence of senior legal, investment, compliance, transition and customer relationship personnel from Capita it was agreed that the handover will be completed by the end of February 2010. Capita commenced discussions with CEO of Marlborough who were pleased to takeover the role of ACD. At no stage and prior to November 2009 Capita made a request for AIM's investment strategy.
CF Analyst UK was voted as Number 1 Fund for the calendar year 2008 by The Daily Telegraph's Internet site and the publication This is Money. The Fund as at 30 November 2009 is down by 5.05% compared to FTSE which is down by 4.42% since launch on 1 December 2005.
Capita has appointed another Investment Manager without prior consultation with AIM and/or shareholders of the Fund. ACD Services Limited a wholly owned subsidiary of Capita and the Directors of the Fund are in breach of their agreement with the Fund when they failed to open third bank account despite repeated requests from AIM. FSA informed AIM that the breach was not reported by Capita to the FSA.
AIM has appointed three additional investment managers. Paul Cosgrove who previously worked for BZW Stockbrokers, Vicente Mancheno who previously worked for Credit Suisse Private Bank in Gibraltar and was a former member of the Spanish Stock Exchange and Sandeep Jaitly a research analyst and fund manager who previously worked for Crispin Odey and Soditic. Paul and Vicente have been approved by the FSA and bring with them £6 million investment funds for management. Sandeep has passed his investment management examinations and is individually approved by the FSA. He is setting up a Gold Fund to generate additional income from holding physical gold with a target of US$5 million to be launched on 1 April 2010. The proposal has the unequivocal support of leading authorities and experts on the Gold market.
Analyst Investment Management plc
17 February 2010.
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