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Robin Geffen, the man who shook Prudential

The founder of Neptune Investment Management fund had led the protest of the Prudential Agreement – AIA, that ultimately just fell through…

Article also available in : English EN | français FR

After several weeks of negotiations, the CEO of British insurer Prudential has its first large setback, while failing to convince shareholders to pay 35.5 billion dollars for American International Assurance (AIA), which is the Asian branch of the American AIG. Tidjane Thiam, who has only been in place for six months, has lost the battle against an investor who owns only 0.2% of the shares, Robin Geffen, founder and director of Neptune Investment Management hedge fund.

He created a group of protesters that was attended by almost 25% of the shareholders necessary to reject the agreement at the shareholders meeting held on Monday in London. The vote on the agreement didn’t even take place as the management of Prudential withdrew its offer last week after AIG refused to renegotiate the price downward (30.4 billion dollars, or 5 less than the initial offer). This is the first time in the history of the City that such a big and advanced negotiation has failed at the last minute. Cost for Prudential: 450 million pounds.

RRobin Geffen didn’t even go to the SM. “I don’t see myself as an agitator of the City”, he says. “I just think that many companies like to calmly discuss and vote in a conformist manner; the idea that debates are public isn’t part of the tradition. Many of the investors at Prudential weren’t able to make their voices heard to contest the agreement. I simply acted as a lightening rod.”

IThis is the main media success of this 53 year old man, who had already raised his voice to protest the takeover of the British confectioner Cadbury by American Kraft. An approach appreciated by many, but ultimately failed. Four years ago, he also objected to the takeover of ready-to-wear House of Fraser by Icelandic Baugur on the grounds that it has already acquired its competitor Debenhams at a low price two years prior, before incurring heavy debts and reintroducing it in the stock market at a higher price. Baugur managed to acquire House of Fraser at a ridiculous price, but in the end didn’t reintroduce it into the stock market… and it collapsed three years later in the wake of the crisis.

Beyond these media blows, Robin Geffen is best known in the City as the director of one of the best performing funds of the decade. Founder of NIM in 2002 with his own funds, he continues to lead nine of the twenty-eight funds included. Most have outperformed their respective sectors over periods of 1, 3, and 5 years.

Neptune’s investment strategies, at the instigation of Geffen, are quite specific: they are to emerge from the unique analysis to adopt a broader spectrum of data, top-down, on a more macro-economic base than normal, based on more efficient stocks.

Geffen’s performance relative to Peer Group Composite speaks for itself. Year 1: 24.7% for Geffen against 20.8% for PGC ; Year 3: 6% against -6.3; Year 5: 86.1% against 34.2%; Year 7: 166.4% against 75.2%; Year 9: 120.3% against 36.5%. “We’ve doubled our assets volume each year until the crisis, where we increased only 20% in the worst configuration market since 1974,” He explained recently in the Financial Times.

Neptune, who is private equity and is 75% owned by its employees and directors. Last year, Neptune was rewarded Fund Manager of the Year 2009 by Investment Week. The fund is present in developed markets, the global funds, UK funds, investment management and multi-emerging markets.

Robin Geffen benefits from an experience of thirty years. Quite an unusual journey, since initially he majored in philosophy before joining Oxford in 1979 and began a career in finance at Charterhouse J Rothschild. Then he joined Eagle Star, first at the European desk, then Asia Pacific. Then Senior Investment Manager at York Trust before launching the first UK pension fund in emerging markets at Scottish Equity. And finally Orbitex Investments Limited, as investment director.

It’s rather “out of place” as his company is away from the bustling City, and settled in the quiet and wealthy neighborhood of Hammersmith, West London. The nickname that’s often given to him is Anthony Bolton, one of the managers of the best performing funds of the City.

JH June 2010

Article also available in : English EN | français FR


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