Ivory & Sime in takeover spotlight as chief quits

The recent staff turmoil at Ivory & Sime, the Edinburgh fund management group, came to a head yesterday with the ousting of managing director Colin Hook by Caledonia Investments, the group's largest shareholder.

Mr Hook is being replaced immediately by Sir David Kinloch, deputy chief executive of Caledonia, the main investment vehicle of the wealthy Cayzer family which owns a 29 per cent stake in Ivory & Sime.

The shares added 2p to 246p on hopes that the move makes it more likely that the group will become a takeover target.

Mr Hook was appointed by Caledonia two years ago following its original investment to sort out Ivory & Sime after a period of staff departures and poor investment performance. But he quickly invoked the ire of many fund managers by removing them from the board and stamping what was said to be an autocratic management style on the group.

The rising discontent has seen a string of staff departures in the last few months, culminating in the recent announcement that a large part of the UK equities team was leaving to set up on their own, including Mark Tyndall, the head of the department, and John Dodd, leader of the smaller companies team.

Sir David, who was until yesterday non-executive chairman, said investigations he had instigated after his increasing concern over the defections at senior level had all pointed in the same direction.

Mr Hook had done an excellent job in the early part of his tenure at the group, "but people found it difficult to get on with him and it affected staff morale. I talked to him over the weekend and he offered to resign, which I accepted."

He dismissed suggestions that there had been a mutiny among staff still remaining at Ivory & Sime and said Caledonia had no plans to sell its stake. "We bought this as a long-term investment and we intend to improve it over time."

He added that Sumitomo Life and Sumitomo Trust Bank, which together hold around 18 per cent of the shares, remained supportive.

A former regular soldier in the Royal Engineers, Mr Hook is on a 12-month rolling contract worth a basic pounds 120,000 a year. Last year, bonuses, pension contributions and other benefits bumped that up to pounds 218,000.

Comment, page 17

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