Dunedin reassures investors

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The Independent Online
Dunedin, the investment management house, was yesterday trying to reassure investors who have pounds 5.6bn in its funds that business would continue as usual after the sudden departure of the chairman and his deputy.

Hamish Leslie Melville resigned at the weekend following a decision by Bank of Scotland, majority shareholder in Dunedin, that they were no longer prepared to accept his allegedly abrasive management style. Alan Kemp, deputy chief executive, believed to be one of Mr Leslie Melville's closest supporters, followed him out of the company. Dunedin is now searching for a new chairman, with Eric Sanderson, its chief executive, temporarily holding both titles. A new appointment is expected shortly.

A source said that concerns within Dunedin and Bank of Scotland surfaced after the sudden resignation of Gordon Anderson, the company's head of investment. It is believed many Dunedin board members felt that they should have been consulted by Mr Leslie Melville before Mr Anderson left.

The crisis within Dunedin accelerated following the resignations tendered by Peter Tait and Nigel Barry, two of Dunedin's investment directors, a few weeks ago. Both were said to have been extremely unhappy with their chairman's management style.

Last week, Doug Waggoner, who runs Dunedin's operation in the United States, announced he was leaving. Several other fund managers who have left are also believed to have been unhappy with developments.

Despite Dunedin's success during Mr Leslie Melville's three years as chairman, when funds under management grew from pounds 3bn to pounds 5.6bn, sources claimed that this was achieved largely through teamwork.

Fears that the spate of departures would turn into a rush, provoking the exodus of many US corporate clients, led to the sudden decision last week. It is believed that, in addition to the Dunedin board, directors of the company's seven investment trusts were also asked for their views.