UK-based investment company Alliance Trust said it will close its Hong Kong office, along with making redundancies in other offices which will result in a 12 per cent reduction of its workforce, as part of a drive to reduce its cost base.
In an interim management statement, Alliance Trust said that it would be making 40 redundancies from its operations in Hong Kong, London and Dundee.
With the exception of Hong Kong, none of the affected employees are engaged in the day-to-day management of Alliance Trust’s investment portfolio, the firm said.
The Hong Kong office is scheduled for closure in the first quarter of 2009; subsequently its staff and functions will be moved to the UK in order to create a centralised investment team.
The decisions, along with plans to reduce overheads, are the result of a review initiated by the firm’s new chief executive, Katherine Garrett-Cox.
Ms Garrett-Cox said: “Current market conditions make it all the more important that we remove unnecessary cost and manage the company to generate the best possible returns for shareholders.”
The company also reiterated its commitment to the launch of a UK asset management business, Alliance Trust Asset Management, for which the first products will be unveiled early next year.
Meanwhile, the firm also said that it would continue to focus on cost management within Alliance Trust Savings and was still in the process of recruiting a managing director for the subsidiary.
Going forward, Alliance Trust stated that its strategic priority was to focus on quoted equities as its core investment and said that it will revise its performance target, which is currently based on performance relative to the Retail Prices Index.
The company said its net asset value had declined 15.8 per cent in the third quarter, just behind the FTSE All World Index which fell 15.7 per cent, but ahead of the FTSE All Share which dropped 19.7 per cent.
Alliance Trust, which is headquartered in Dundee, had assets under management of nearly £2.6 billion ($3.9 billion) at 31 July 2008.