Abrdn is to merge an investment fund that was once Britain’s biggest after years of mediocre performance, as the quoted asset manager seeks to streamline underperforming operations.
Sky News has learnt that Abrdn informed staff on Thursday morning that Global Absolute Return Strategies (Gars), which once managed tens of billions of pounds of investors’ money, is to cease operating as a standalone vehicle.
The decision to fold it into the company’s diversified asset funds comes after Gars’ assets fell to £1.4bn – down from £27bn in May 2016.
The fund was originally established to help plug the deficit in the Standard Life pension scheme, with its ‘absolute return’ objectives then rolled out to institutional and wholesale clients.
Abrdn has been reviewing Gars’ future for months.
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One analyst said the decision to merge it was expected to be positioned as a proactive decision to merge Gars into a better-performing fund in the wake of shifts in client demand for absolute return funds.
In a statement, Russell Barlow, Abrdn’s head of multi-asset and alternative investment solutions, said: “My focus during the strategic review was to clarify roles, reduce inefficiency and increase collaboration ensuring we deliver the best outcomes possible for our clients.
“The new structure simplifies our processes and facilitates a greater comparison of opportunities across asset classes rather than being focused on research within single asset classes and products.
“I’m confident this approach is best suited to the needs of our clients in delivering strong performance outcomes across a more relevant product range.”
The closure and merger of a number of other funds comes about two weeks before Abrdn, which manages about £386bn, reports half-year results.
