Manager Research

We recently completed our research process with Electus, one of the Old Mutual boutiques, and rated three of their funds: the Old Mutual Growth fund, the Old Mutual Top Companies Fund and the Nedgroup Investments Growth Fund.

However, the Old Mutual Investment Group (OMIG) announced on 29 January 2015 that they will be selling their stake in Electus. Electus will effectively be separating from OMIG, and will become an independent asset manager that is 100% owned by their two portfolio managers (Neil Brown and Richard Hasson) and other staff. The team recently moved out of the Old Mutual offices, citing the desire for more independence from Old Mutual.

Electus will take all their research and data with them into the new independent business, and OMIG will provide various forms of administration and compliance support until all the necessary licences are sorted out. However, there is uncertainty as to whether the Electus analyst team will remain intact. Electus also ran the Old Mutual Global Emerging Market fund. Feroz Basa and Siboniso Nxumalo will remain with OMIG heading up a new Emerging Markets boutique.

The Old Mutual funds currently managed by Electus will remain with Old Mutual, and be allocated to other boutiques (primarily Old Mutual Equities headed up by Peter Linley). We will therefore have to conduct our research again on the funds with the new management teams, assuming these funds are not closed and rolled up into another Old Mutual equity offering.

For the Nedgroup Investments Growth Fund, it appears Electus will continue to manage the fund for the time being. We will need to revisit our research and rating following the changes, but will conclude on the fund shortly given that the manco, the process and their track record remain intact. The business will change materially - the focus in the short term will be on building a business and its operations, and their assets under management will drop materially with all Old Mutual in-house funds and the OMIG unit trusts remaining.