Hermes Focus Asset Management Europe is launching its European Focus Funds on 25 February, with 7 pension fund investors and a total of EUR 300 million in committed funds. Initial investors are:
– BT Pension Scheme (the largest UK pension scheme and No. 3 in Europe with EUR 44 billion of assets as at 31 December 2001)
– PGGM (a Dutch based pension fund for the health care and social works sectors; No 2 in Europe with EUR 50 billion of assets)
– Consignia Pension Plan (the fourth largest UK pension scheme and amongst the largest in Europe with EUR 26 billion of assets)
– 4 UK county council (local government) pension funds
Most of the funds’ investors are already participants in the successful Hermes UK Focus Funds. PGGM is a new investor which is particularly interested in corporate governance improvements in continental Europe. It is already involved in shareholder engagement in The Netherlands and will participate in the funds for investments outside The Netherlands.Hermes expects further European and global investors to join the European Focus Funds and to build the funds to EUR 1 billion over time.”We are pleased to see how supportive the pension fund industry is of our investment style”, says Stephan Howaldt, Chief Executive of Hermes Focus Asset Management Europe Limited, who together with Marco Ricci (Investment Director) manages the funds. “We involve ourselves in constructive yet persistent discussions with companies that own good businesses but whose share prices have been underperforming their respective sectors.”
The portfolio of the funds will comprise a small number of stocks with relatively large percentage shareholdings. Engagement with investee companies will be tailored to their specific local and strategic circumstances. Hermes Focus Asset Management Europe Limited, which manages the fund has team members today from five continental European countries and from a broad range of professional backgrounds. Investments in Germany, France and Italy are priorities for the next year.