Alliance Trust CEO steps down from board as Elliott forces overhaul
By Nishant Kumar and Matt Scuffham
LONDON (Reuters) - Katherine Garrett-Cox, one of the City of London's most high profile women CEOs, is to step down from the board of Alliance Trust in an overhaul of the fund manager which has faced pressure from activist investor Elliott to make changes.
Garrett-Cox, who will continue as chief executive of Alliance Trust Investments, has long been battling demands from shareholders to tackle the fund's underperformance and the gap between its shares and the value of the assets it holds.
The 127-year old trust, with total assets of 3.3 billion pounds ($5 billion), said on Thursday it planned to sell non-core investments, including its fixed income, mineral rights and property assets, and cut costs to produce savings of 6 million pounds next year. It plans to make its board fully independent, consisting solely of non-executive directors.
Chairman Karin Forseke dismissed suggestions by shareholder advisory group ShareSoc that the changes may not be enough to satisfy Elliott, which has a 14 percent stake in Alliance Trust.
"This is not the thin end of the wedge," Forseke told Reuters, adding that the changes had been made in consultation with all of the trust's investors, including its 70 percent retail shareholder base.
"We have looked at every possibility, there have been no sacred cows in this organization."
Elliott declined to comment.
The group will create separate boards for its fund management division Alliance Trust Investments and its Alliance Trust Savings business to increase accountability. Continued...