Bullish Henderson keeps it powder dry on Gartmore bid talk

FUND manager Henderson yesterday refused to be drawn on speculation that it would bid for rival Gartmore as it unveiled increased profits for the first six months of 2010.

It said underlying pre-tax profits grew by 79 per cent to 48.5 million in the first half of the year despite a 1.7 billion fall in assets under management to 56.4bn. Henderson, which bought New Star in April 2009, also reported that 72 per cent of its fixed-income funds and 69 per cent of its equity products either matched or beat their performance benchmarks over the last year.

Andrew Formica, chief executive of Henderson, said: "Henderson has delivered a strong first half, despite market volatility and fragile investor confidence, with revenues growing by 50 per cent and underlying profits by some 80 per cent compared to the first half of 2009."

But he refused to comment on growing speculation that the firm was considering a bid for Gartmore. Its rival this week revealed that its assets under management fell by 9 per cent in the first seven months of the year after investors took 1.9bn of cash out of the group's funds. It shares plummeted following the departure of star manager Guillaume Rambourg, who was suspended in May after an internal investigation and then left the company last month.

However Formica did reveal that Henderson was planning to expand its existing offering to retail investors, with further property, hedge fund and absolute return products in the pipeline.

"We are well positioned to launch new products and to continue to grow our business in all the channels and geographies where we operate," he said.

He went on to caution that markets were likely to remain volatile for the remainder of the year.

"We are also alert to the potential impact of regulatory changes on our business as regulators and governments seek to rebuild trust and confidence."