Fundsmith offers chance to share veteran's elan

ONE of the City's best-known and most outspoken veterans, multi-millionaire Terry Smith, is to launch a fund management business that will bear his name.

Fundsmith will let retail and institutional shareholders invest alongside Smith, who is reported to be ploughing in up to 20 million of his 60m fortune to help get the business started in the next few months.

It is believed Smith, aged 57, will leave the board of broker Collins Stewart as a result of his new venture, but will remain as chief executive of Tullett Prebon, the City moneybroker.

Keith Hamill, chairman of Tullett, is also involved in the new fund manager.

Fundsmith will be the first business Smith has initiated from scratch, and is expected to be receiving investments by the end of 2010, subject to regulatory approval from the Financial Services Authority.

It is understood that the foundation of Fundsmith has been planned since April of this year. Although Smith is thought to have initially decided to step down from Collins Stewart after a period of transition, it is now believed his departure will coincide with the launch of the new business to ease regulatory concerns. Smith has led the brokerage since 1996.

He later masterminded the highly successful demerger of Tullett Prebon from Collins Stewart in 2006. Hamill, the former chairman of Moss Bros and British Airways' budget airline Go, is likely to chair the new venture, which is not expected to float on the stock market.

Hamill remains a non-executive director of Collins Stewart and held the position of deputy chairman until April.

Smith, a colourful City figure whose interests include boxing and flying helicopters, first became widely known in the early 1990s with his book, Accounting for Growth, which sharply criticised the accounting of many of the big corporate names of the day, following the collapse of Polly Peck and British and Commonwealth Holdings.