Investment fund group Henderson could be new owner of New Star

26 January 2009 / by Rachael Stiles
Amidst speculation, Henderson Group has confirmed that it is considering a potential take over of New Star Asset Management.

The fund management group said while it is "in discussions over a possible offer" for the struggling firm, there "is no certainty that any deal will be forthcoming."

New Star was languishing under £240million of debt last year, until it agreed to a debt-for-equity swap and a de-listing from the stock exchange. It has experienced huge outflows of funds in the wake of the current financial crisis.

Investment assets under management at New Star reportedly fell from £19.8billion last June to £14.3billion in November, making it a likely candidate for a take-over.

Regardless of whether or not an offer is made and a sale goes through, Henderson was quick to ease investors' concerns, confirming that it "intends to recommend a total dividend in relation to 2008 of 6.1 pence per share, equivalent to the total dividend paid in respect of 2007."

Henderson issued the statement about the potential take-over in response to speculation in the press that it had been given exclusive negotiation rights in order to secure a deal with New Star.

A sale could offer relief for New Star, as it is currently being controlled by its lenders which include HSBC, Lloyds Banking Group, RBS and National Australia Bank.

Potentially facing a restructuring of its capital with its lenders, New Star said in a circular to its shareholders that it is "actively pursuing possible alternatives to the Restructuring" such as a sale of the company or the company's business.

But, it added, "there can be no certainty that any such alternative transaction will be forthcoming", nor that any such sale, should it occur, would result in a significant return for its shareholders.

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