6th Dec 2007 09:05
Hiscox Ltd06 December 2007 BUYOUT OF THIRD PARTY FUND MANAGEMENT BUSINESS FROM HISCOX Hamilton, Bermuda - Hiscox Ltd ("Hiscox") the specialist insurer announces todaythat it has agreed to sell its third party fund management arm, HiscoxInvestment Management Limited, to the principals, creating an independentinvestment management company. Hiscox will have a 40% shareholding in thecompany, with management holding the remainder. The buyout is due to complete on31st December 2007. The gross assets of Hiscox Investment Management at theclosing of the transaction are expected to be approximately £2 million. Oncompletion Hiscox Investment Management Limited will change its name to HIMCapital Limited ("HIM Capital"). HIM Capital will continue to specialise in the financial sector, initiallyoffering three funds: the Hiscox Insurance Portfolio Fund focusing on Globalinsurance, the Hiscox Far Eastern Financial Fund investing in Asian financialsex-Japan, and the Hiscox European Financial Fund focusing on European financialswith a specific emphasis on emerging Europe. HIM Capital will launch withapproximately £125 million under management. HIM Capital will be led by Alec Foster as chairman, Mark Stacpoole as managingdirector and John Yakas and Nick Martin as fund managers. (Biographies anddetails of the three funds are attached in the editors' notes). Commenting on the transaction, Bronek Masojada, chief executive of Hiscox, said:"In recent years the team at Hiscox Investment Management have establishedthemselves as a leading specialist fund manager in financials. Independent ofHiscox, the management team will be well positioned to develop this area andgrow the business organically and through partnerships." Alec Foster, chairman of HIM Capital, said: "The management buyout of Hiscox'sthird party fund management business represents an exciting new chapter for myteam and for our fund investors. We will continue to focus our energies onproviding specialist investment management in financials. Although financialshave been under significant and indiscriminate pressure over the past monthsthis has highlighted the opportunities now available for working withspecialists. Financials form an integral part of the global economy and we lookforward to using our expertise in this area for the benefit of our fundinvestors in the years ahead." The launch of HIM Capital will capitalise on the management team's experience ofinvesting in financials while allowing the company additional opportunities todevelop and grow. The team has a strong belief in the value of specialist fundmanagement in the financials sector. The company's investment process focuses onbottom-up stock picking, using research generated internally. The investmentstrategy has a strong quality bias and the managers prefer a buy and holdapproach to portfolio management. HIM Capital's target investors are theinstitutional and high net worth sectors. For Hiscox, the specialist mutual funds business has been a valuable, albeitnon-core, part of the group. Hiscox will continue to be an investor in the fundsand with its significant stake in the business will have a representative on theboard. Hiscox will retain oversight of the investment of its own assets. Ends All media enquiries: Mainland Phoebe Davison/Neil Mainland0203 008 740007771 981672/07753 787290 Hiscox Investment ManagementAlec Foster/Mark Stacpoole0207 448 6000 Hiscox LtdKylie O'Connor/Robin MehtaGroup Communications/Company Secretary0207 448 6656/+1 441278 8300 Editors' Notes: About Hiscox Investment Management Hiscox Investment Management is an investment management subsidiary of HiscoxLtd. It is responsible for supervising the investment of the Hiscox Group'sfunds. It is also a specialist fund manager with an established track record andexpertise of managing portfolios in the financial sector, principally in bankingand insurance. The company has been managing specialist financials funds since1993 and currently has funds under management of approximately £125 million. Thebuyout will complete on the 31st December 2007 and has been approved by the FSA.Following the completion of the transaction, the company will be renamed HIMCapital Limited. The HIM Capital Funds The Hiscox Insurance Portfolio Fund (Manager: Alec Foster) was launched in 1998and has returned +82.7% versus +32.1%* for the Datastream World Insurance Index(£). The fund is the only European vehicle for investing in insurance industrycompanies worldwide. The £51 million fund offers a diversified exposure toleading property/casualty and life insurers, brokers and related insurancebusinesses worldwide, placing a specific emphasis on mid-cap insider-ownedcompanies. The fund is managed as a portfolio of insurance "risks", placingparticular emphasis on underwriting and the ability of managers to make superiorreturns across cycles. Alec Foster has worked in the industry for 40 years andhas an excellent network of contacts particularly in the US and the UK. The Hiscox Far Eastern Financial Fund (Manager: John Yakas) was launched in 1996and has returned +150.0% versus +59.9%* for the Datastream Asia ex-JapanFinancials Index. The $65 million fund is the only European investment vehiclededicated to investment in financial companies in the Far East excluding Japan.Asian financials offer a warrant on the growth of the world's most excitingeconomies yet are less exposed to some of the speculative excesses of moredeveloped markets. The fund will benefit from the growing wealth of the Asianconsumer and the huge infrastructure expenditure across the region. Theincreasing demand for both borrowing and saving products of banks, insurers andasset managers will offer exciting investment opportunities as the marketsmature from export-led economies to domestic powerhouses in their own right. The Hiscox European Financial Fund (Manager: John Yakas) was launched in 1993and has returned +373.8% versus +276.7%* for the Datastream European FinancialsIndex. The €20 million fund has a long track record of benefiting from thesignificant changes to the European financial landscape over the past 15 years.An initial beneficiary of the moves towards a single market and thereafter theintroduction of a single currency, the fund has most recently been positioned tobenefit from the expansion of Europe into the new countries of Central andEastern Europe. The fund has built up increasing holdings in the growth marketsof emerging Europe with some 50% of the fund in the region either through directinvestment or through companies with subsidiaries in the region. HIM Capital isin the process of seeking approvals to merge the Hiscox Global Financials Fundinto the Hiscox European Financial Fund. This process is anticipated to becompleted early in the New Year. * Performance data as at 30th November 2007 The HIM Capital Team Alec Foster will be chairman of HIM Capital. He will continue to manage theHiscox Insurance Portfolio Fund in conjunction with Nick Martin. Alec has workedin the insurance business for 40 years, first as an insurance broker in theLondon market and for the past 31 years at Hiscox. Prior to the buyout he wasmanaging director of Hiscox Investment Management and had been group investmentofficer until 2005. He launched the Hiscox Insurance Portfolio Fund in 1998. Hewas chairman of Universal Salvage plc, the listed insurance related vehicleservice company prior to its acquisition by the US company Copart in 2007. He isalso a director of Midas Capital Partners, the Liverpool based fund manager andTrustee Director of St Andrew's Healthcare. Mark Stacpoole, former director of marketing at Hiscox Investment Management,will become HIM Capital's managing director. Mark has spent 24 years in thefinancial services industry and the past five years in the asset managementbusiness. Mark started his career in capital markets at Morgan Grenfell in 1983and in 1988 joined Kleinwort Benson where he was a director of corporate financefor nine years. In 2000, he joined a start-up financial services group EO as amanaging director. In 2002, he joined Warnborough Asset Management, the privateequity group, as managing director responsible for fund raising. He joinedHiscox in 2004 as director of marketing to increase the distribution of thefunds both in the UK and internationally. John Yakas is the manager of the Hiscox Far Eastern and European FinancialsFunds. John has worked in the financial services industry for the past 20 yearsand has been with Hiscox for the past four years. He has been involved with theHiscox Far Eastern Financial Fund since its launch in 1996. He has also beenresponsible for the migration of the Hiscox European Financial Fund to Centraland Eastern Europe over the past two years. He has held a number of positionswithin the banking and financial research industry prior to becoming the Head ofAsian Research at Fox-Pitt, Kelton in 1995 and launching their office in HongKong in 2000. He left Fox-Pitt, Kelton in 2003 and became a Director of HiscoxFar Eastern Financial Fund and a consultant to Hiscox Investment Management. Nick Martin is the co-manager of the Hiscox Insurance Portfolio Fund, workingclosely with Alec Foster. He has worked in the financial services industry fornine years and at Hiscox for the past six years. He provides company analysis aswell as being deeply involved in all the investment ideas for the Fund. He is aqualified chartered accountant and obtained a first class honours degree, BscEconometrics and Mathematical Economics at the London School of Economics. Nickdeveloped a broad knowledge of the insurance sector at the charteredaccountants, Mazars Neville Russell, where he specialised in audit andconsultancy work for insurance companies, insurance brokers and Lloyd'ssyndicates. The non-executive directors on the HIM Capital Board will be Adrian Collins andCharles Dupplin. Adrian Collins has worked in the fund management business forover 30 years, a large part of which was at Gartmore Investment ManagementLimited where latterly he was managing director. Adrian is a director of anumber of asset management companies including Midas Capital Partners, CorvusCapital and two investment trusts. Charles Dupplin is the appointedrepresentative of Hiscox, where he is the chairman of the Art and Private Clientdivision and director of mergers and acquisitions. About Hiscox Hiscox, headquartered in Bermuda, is a specialist insurance group listed on theLondon Stock Exchange. There are three main underwriting parts of the Group -Hiscox Global Markets, Hiscox UK and Europe, and Hiscox International. HiscoxGlobal Markets underwrites mainly internationally traded business in the LondonMarket - generally large or complex business which needs to be shared with otherinsurers or needs the international licences of Lloyd's. Hiscox UK and HiscoxEurope offer a range of specialist insurance for professionals and businesscustomers, as well as high net worth individuals. Hiscox International includesoperations in Bermuda, Guernsey and the USA. Hiscox Insurance Company Ltd,Hiscox Underwriting Ltd and Hiscox Syndicates Ltd are authorised and regulatedby the FSA. This information is provided by RNS The company news service from the London Stock Exchange ENRelated Shares:
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