Alliance Trust and Witan Investment have announced a merger which will create a £5bn investment trust.
The combined companies will be known as Alliance Witan PLC.
It comes after Witan’s review of its portfolio in the wake of the retirement of CEO Andrew Bell after 14 years.
Andrew Ross, chairman of Witan, said since the announcement of Bell’s retirement the firm has been through an “extensive process” to find the best candidate to take on the management of shareholder assets.
He said: “The board assessed a number of very strong proposals, including single-manager candidates with impressive track records.
“However, the board was unanimous in recommending the combination with Alliance Trust, which allows the continuation of our multi manager approach at lower fees and in a larger, more liquid vehicle.
“The companies share similar cultures and a mutual desire to provide a ‘one stop shop’ for retail investors in global equities.”
The combination is set to be carried out through a scheme of reconstruction by Witan under s110 of the Insolvency Act 1986, which will see Witan roll into Alliance Trust in exchange for the issue of new Alliance Witan shares to the continuing Witan shareholders.
Alliance Trust’s investment manager, Willis Towers Watson, will have overall responsibility for managing the assets of the combined Alliance Witan.
Dean Buckley, chair of Alliance Trust, said: “The formation of Alliance Witan brings together the two leading open-architecture multi-manager investment company propositions in the UK to form a FTSE 100 equity investment vehicle with the quality, cost efficiency and profile to play a leading role in the UK investment market.
“Shareholders will benefit from access to the proven investment process implemented by our investment manager, Willis Towers Watson, and access to the world’s leading stock pickers.
“This is also a significant moment for our industry in broader terms – Alliance Witan represents a key milestone in the history of the investment trust structure which has demonstrated its capabilities very effectively over many decades.”
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