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Star fund manager leaves River and Mercantile Micro Cap


Star fund manager leaves River and Mercantile Micro Cap – Philip Rodrigs, manager of River & Mercantile Micro Cap, has left the management company following “an investigation into a professional conduct issue”. He is leaving the company today and the fund has not been affected by his actions.

River & Mercantile Group has released the following announcement:

The company announces that portfolio manager Philip Rodrigs has today left its subsidiary, River and Mercantile Asset Management LLP (RAMAM), following an investigation into a professional conduct issue.

Philip Rodrigs left on Wednesday 7 February 2018. He was previously lead manager of the River and Mercantile (‘R&M’) UK Equity Smaller Companies Fund, the R&M UK Dynamic Equity Fund, and the R&M UK Micro Cap Investment Company Limited. In each case the principal portfolio management responsibility has passed to an alternate manager within RAMAM’s successful ‘PVT’ team in accordance with its well established succession plans.

The conduct issue was unrelated to his portfolio manager responsibilities and has not impacted the pricing or NAV of any RAMAM fund and no client or investor has been negatively affected in connection with this matter.

James Barham, Chief Executive Officer at RAMAM, said: “It is disappointing to have to take this course of action but we have acted swiftly to ensure that the portfolios continue to be managed in line with our PVT investment philosophy and process. This will ensure that we continue to deliver market leading investment returns for our clients.”

The R&M UK Equity Smaller Companies fund will now be managed by Dan Hanbury, who previously ran this fund prior to Philip Rodrigs’ appointment in September 2014; the multi-cap R&M UK Dynamic Equity Fund will be managed by William Lough, in addition to his continuing responsibilities as alternate to Hugh Sergeant on RAMAM’s High Alpha and Recovery strategies; and management of the R&M UK Micro Cap Investment Company Limited will pass to the alternate manager on this portfolio, George Ensor.

Hugh Sergeant, RAMAM’s Chief Investment Officer for Equities, said: “River and Mercantile Asset Management has consistently generated excellent returns for its clients over the past 11 years and this is in large part due to the strength and effectiveness of the philosophy and process we created when we set up the business in 2006. With this robust process in place, alongside the depth and breadth of experience we possess within the PVT team, we’re confident that this change in the team’s structure can be comfortably absorbed with no adverse impact to the funds’ management.”

The PVT philosophy, named from the three key criteria the team apply in seeking out investment opportunities – Potential, Valuation and Timing – involves a proprietary quantitative tool that analyses a global universe of stocks and filters out only the most promising opportunities for further fundamental analysis by the team.”

Update 19 February

The board has made the following announcement: “While Philip Rodrigs was the principal portfolio manager at RAMAM, he was supported by a team, including George Ensor, who has worked with Philip on the investment process since the Company was launched in 2014 and with whom the Board has interacted previously. 

We also recognise that RAMAM has used its proven PVT investment philosophy to manage the portfolio since the Company was established and that this process has been partly responsible for driving the strong NAV performance of the Company. The PVT system will continue to be used in future. 

As an independent board, immediately we were notified of the change of lead manager, we commenced a process to confirm for ourselves that George Ensor is suitable to act as lead manager. The Board is satisfied that the MicroCap team, now led by George Ensor, should maintain its position as portfolio manager. In line with our normal practice we will continue to monitor portfolio management arrangements.”

River & Mercantile Micro Cap’s shares are off 11.3% at the time of writing.

RMMC : Star fund manager leaves River and Mercantile Micro Cap

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