UK - The £4bn Unilever Superannuation Fund is to bring its £100m law suit against Mercury Asset Management to court in October.
A spokeswoman for the Anglo-Dutch household goods giant confirmed that the court date has been set for October 15.
The original proceedings were brought against MAM in 1999 when Unilever filed a breach of contract suit against the asset manager for having “failed to take sufficient account of the risk of under-performance in its management of USF assets, and in particular of the UK equity portfolio, and that it failed to take adequate steps to contain the risk of breaching the previously agreed ‘downside tolerance.”
The alleged negligence took place between January 1997 and March 1998, when MAM’s overall portfolio under-performed the agreed benchmark by 8%. According to USF, MAM’s performance was significantly below the fund’s tolerance level of no more than 3% for any four successive calendar quarters.
When MAM’s contract was terminated in March 1998 underperformance had increased to 10.5% over five quarters since reappointment, according to USF.
MAM was reappointed as one of USF’s investment managers under the new contractual terms from January 1, 1997, having previously been a fund manager for about 10 years, overseeing securities then worth approximately £1,090m.
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