UPDATE 1-Schroders loses UK equity chief to Old Mutual
LONDON, March 15 (Reuters) - Richard Buxton, head of UK equities at Schroders and one of Britain's highest-profile fund managers, is leaving to join smaller rival Old Mutual Global Investors, both firms confirmed on Friday.
Errol Francis who co-managed the Schroder UK Equity Fund and has worked with Buxton for 16 years, will also leave for Old Mutual Global Investors.
The moves are a blow for Schroders as Buxton was a high-profile name with an enthusiastic following of investors after more than a decade at the company. However, they mark a coup for Old Mutual, which is moving to boost its fund management business.
Old Mutual, in a statement, said Buxton would become its new head of UK equities. Shroders announced on Thursday that he would leave the company on June 14.
Buxton managed the successful 3.5 billion-pound ($5.3 billion) Schroders UK Alpha Plus fund, whose investors are mostly private investors who are seen as more likely than institutions to follow a fund manager to a different firm.
Still, Buxton's arrangement to stay at the helm of the fund for three months before taking up his new role appeared to have already calmed some jitters.
"Investors don't need to rush to sell this fund, since Richard is staying on until June. When we know who is taking over the fund we will be able to inform investors," said Mark Dampier, head of investment research at Hargreaves Lansdown .
Speaking to Reuters on Friday, Schroders' Global Head of Equities Peter Harrison emphasised that Buxton and Francis were part of a team of experienced portfolio managers, 16 of whom remain at the firm.
He acknowledged that replacing such a high profile manager as Buxton quickly was a challenge but said Schroders, one of Britain's best known fund managers, is in a strong position to find top talent from inside or outside the firm.
"We have the firepower to do whatever we want given the brand we have got," he told Reuters.
"I want to take a good look at the team and we have a full three months to make that decision. Generally the right decision is not one you make in the heat of the moment."
Buxton will report to Julian Ide, Chief Executive of Old Mutual Global Investors. Ashton Bradbury, who has run the UK equities teams for three years, will report to Buxton.
"Old Mutual are trying to build their presence in the UK and the signing of this star manager is a significant statement of intent," Hargreaves Lansdown's Dampier said.
Buxton, who joined Schroders in 2001 to manage specialist UK equity portfolios, has been outspoken on several high-profile takeovers and issues such as the compensation of Xstrata executives as part of the merger with Glencore.
He began his investment career in 1985 at Brown Shipley Asset Management as a fixed-income and equity investment manager. He was UK equity manager at Baring Asset Management from 1990 after spending a year at GRE Asset Management.
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