Invesco Loses Another Mandate to Woodford

Invesco Perpetual is set to lose another significant mandate to its former star fund manager, Neil Woodford, who set up on his own earlier this year.

U.K. asset manager Skandia, a unit of insurer Old Mutual PLC, is preparing to transfer a GBP640 million (US$1.1 billion) mandate from Invesco to Woodford Investment Management, a Skandia spokesperson said.

Skandia is moving the funds across to WIM "so that investors continue to benefit from the proven investment expertise of Neil Woodford," the spokesperson added.

Mr. Woodford, a 26-year veteran of Invesco, set up WIM following his high-profile departure from Invesco in April.

Most recently, he oversaw around GBP27 billion across six Invesco funds, scoring returns of about 12% annually over his last five years with the firm. That helped him to build a loyal following and become one of the U.K.'s best-known and most successful portfolio managers.

His departure from Invesco came as a shock to many investors. In April, wealth management company St. James's Place said it was withdrawing an GBP8 billion mandate from Invesco to invest some of the money with WIM. U.K. asset manager Hargreaves Lansdown in June also said that it had withdrawn money from Invesco and had invested about GBP450 million in the new Woodford fund.

Several former Invesco employees also moved over to WIM.

Skandia, which manages about GBP80 billion of investors' money in total, is transferring the funds from Invesco to WIM on October 9. It said that clients wishing to keep their funds at Invesco could do so through the Skandia Invesco Perpetual Strategic Income fund which remains open.

Invesco declined to comment. WIM could not be reached for comment.

Mr. Woodford's first fund at his new venture, the Equity Income Fund, launched in mid-June and attracted GBP1.6 billion of investment during a two-week initial offer period. The fund mostly buys stakes in U.K.-listed equities, though it can also invest up to 20% in overseas companies. Since the launch, it has grown to around GBP2.5 billion.

Mr. Woodford recently told The Wall Street Journal that he believes Europe's equity markets are overvalued, and warned about a troubling outlook for economic growth in Europe and the U.K.

Skandia's decision to transfer funds to WIM was first reported by Investment Week.

Andrea Tryphonides contributed to this article.

Write to Josie Cox at [e-mail]

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