RAB Capital chief executive steps down
Philip Richards has stepped down as chief executive of UK-quoted hedge fund manager RAB Capital to focus on running its troubled flagship special situations fund, which has made a 33% loss this year after it bought a stake in collapsed bank Northern Rock.
Richards co-founded RAB Capital in 1999 with executive chairman Michael Alen-Buckley and helped float RAB on Aim in 2004.
RAB said Richards will be replaced as chief executive by Stephen Couttie, who has been promoted from finance director.
Richards, who will remain an executive director of RAB, said: "I am pleased to be handing over my business management responsibilities to Stephen and wish him every success in his new role."
Charles Kirwan-Taylor, head of sales, has also been promoted to executive director. The firm's board of directors said the promotion of Couttie and Kirwan-Taylor reflected RAB's desire to become more of an institution, with business management independent of fund management.
A source close to the firm said: "This has been thought about for quite some time." He said the firm could become more focused on fund distribution in the wake of the changes.
Richards has more of a background in portfolio management than fund distribution. He is the senior fund manager for the RAB special situations fund and, since its launch late last year, for the RAB global mining and resources fund.
Richards' increased focus on RAB's $1.4bn (€1bn) special situations fund follows a troubled year for the hedge fund manager, whose investments included a stake in failed UK mortgage provider Northern Rock.
The directors of the fund said, in a report published this week, that it had fallen 13.4% in July and was down 33.32% in the first seven months of this year.
Richards said: "This decline in value does include a very regrettable loss on our position in Northern Rock but even without that position we would still be 29% down for the year."
A listed fund invested in RAB special situations has fallen so far out of favour with public investors that its share price is trading at a 36.77% discount to its net asset value, according to figures as at the end of July, the most recent available. Its directors said this week they were still considering buying back shares in a bid to reduce the premium.
The investment losses of the special situations fund was combined with net redemptions by investors and RAB Capital has this year seen its first reduction in the value of its assets under management since flotation. Its assets fell from $7.2bn at the start of the year to $5.9bn at the end of June and $5.4bn at July 24, the most recent date for which figures are available.
RAB Capital's share price has fallen 70% from its high of 125p a share on 20 July last year to 37.5p a share yesterday. The share price rose this morning to 38p a share at 10.15 British Summer Time.
-- Write to William Hutchings at whutchings@efinancialnews.com
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