JupiterFeb 8 2023

Jupiter sells Starling stake and turns away from private assets

Search sponsored by
Jupiter sells Starling stake and turns away from private assets
Matthew Beesley, chief executive of Jupiter, who wrote to clients yesterday telling them the asset manager's open-ended funds will no longer buy private assets
BySally Hickey

Jupiter has sold its entire exposure to Starling Bank and introduced a ban on open-ended funds buying unlisted assets.

In a letter to clients yesterday (February 7), seen by FTAdviser, Jupiter’s chief executive officer, Matthew Beesley, said the new policy reflects the change in investor sentiment regarding holding unlisted assets in open-ended funds.

The majority of Jupiter’s exposure to the challenger bank was held by the Jupiter UK Mid Cap fund, making up 5.92 per cent of the fund’s total holdings.

Regulator rules ensure open-ended mutual funds cannot hold more than 10 per cent in unlisted assets.

Jupiter’s fund had a 6.48 per cent exposure to private assets at the end of January before selling Starling, however Beesley said as a result of the sustained market volatility in recent years the company will no longer make any new private investments through its open-ended funds.

Beesley has come in and is sorting out the company bit by bitBen Yearsley, Fairview Investing

“While we do still retain very small stakes in a minimal number of other unlisted assets, we will prudently manage these exposures over time with a view to generating maximum value for our clients,” he said.

Some £20mn worth of the Starling holding has been bought by Chrysalis Investments, the trust announced this morning (Febraury 8), alongside a number of institutional buyers, all of whom were existing shareholders in the company.

The new policy is one of the first by Beesley, who took up the role in October last year amid criticism of previous CEO Andrew Formica.

He had previously signalled that there had been a detailed operational review of the business and that there would be some announcements confirming the outcomes of this after the firm struggled with outflows over the past few years.

This includes 15 per cent of the workforce being made redundant and nearly a third of the company's funds closing, merging or being rationalised.

Ben Yearsley, director at Fairview Investing, said the move was a credit to Beesley, who sorted one of the “key problems” in the business.

“[The Starling holding] was not the only issue with Jupiter clearly, but Beesley has come in and is sorting out [the company] bit by bit, which is positive.”

Sheridan Admans, head of fund selection at Tillit, said the decision was a good one but has been “far too long coming”.

“Investors have been left in the dark worrying if their money is at risk of going the same way as it did for investors in Woodford.”

Starling declined to comment.