HSBC Asset Management's battle to gain entry to the HK$750 billion UK investment trust business intensified this week, as it stepped up its campaign to gain control of the Saracen Value Trust despite strengthening opposition from the trust board.
HSBC's very public bid to take over the management and control of the GBP100 million (about HK$1.24 billion) specialist small companies trust was rebuffed by the Saracen board earlier this month.
The managing director of HSBC Asset Management Europe, Alan Gadd, said on Friday that unless events turned, HSBC would win control of the trust from the existing fund mangers, SFM Investment Management, by the end of next month.
'SFM are really finished as fund managers on this trust,' he said. 'As things stand at the moment the board will be handing the contract over to us.' However sources close to the Saracen board said up to five offers for the trust were now being considered. About 12 were originally thought to have been received, with Mercury Asset Management, SFM and Invesco all believed to have been among those making approaches.
At least one bidder is understood to have offered shareholders cash or shares as part of the take-over proposals.
It was the absence of such an incentive that persuaded Saracen to reject HSBC's original bid. Saracen chairman Antony Dick criticised the HSBC proposals for not involving 'a return of capital to shareholders'.
