Jupiter names new chief executive as Andrew Formica prepares to exit

Jupiter Fund Management chief executive Andrew Formica is retiring after only three years in the role, following a lacklustre period marked by fund outflows and a falling share price.

The London-listed fund group, which manages £55bn, said on Tuesday that Formica will step down in October and will be replaced by the asset manager’s new chief investment officer, Matthew Beesley.

Beesley, who joined Jupiter at the start of the year from rival asset manager Artemis, will be appointed to the board and promoted to deputy chief executive straight away while retaining his chief investment officer responsibilities.

The company’s shares have dropped by two-thirds in the past five years and have more than halved since Formica became chief executive. Mid-sized generalist active fund managers such as Jupiter have become squeezed between highly specialised niche players and passive giants such as BlackRock and Vanguard. Jupiter’s core sectors, such as UK and European equities, have also lost favour from investors, and it is often cited as a potential takeover target.

In May, a former board director at Jupiter and small individual shareholder in the company launched a scathing critique of the company. In an open letter to its chair Nichola Pease, fund industry dealmaker Jon Little said the group had “lost its way” and must change its management and overhaul its strategy to preserve its independence.

Little claimed that Formica had “failed to deliver on the key metrics of net sales, shareholder returns and return on equity,” and questioned the wisdom of the company’s acquisition of Merian Global Investors for £390mn in 2020.

Jupiter has averaged net outflows of £4bn a year for the past four years. It reported net outflows of £1.6bn in the first quarter of this year, and overall assets under management decreased by £5.2bn to £55.3bn, hurt by negative market returns of £3.6bn during the three months.

Jupiter said Formica, who joined from Janus Henderson in 2019, “has always been clear with the board that his longer-term plans would involve the relocation back to his native Australia with his family”. He will remain at Jupiter until June next year to help with the transition.

Prior to joining Jupiter, Beesley held the role of chief investment officer at Artemis. He previously worked at GAM, and before that was a fund manager at Henderson Global Investors prior to its merger with Janus Capital Group in 2017. Formica was chief executive of Henderson at the time of the merger.

As chief executive of Jupiter, Beesley will receive an annual salary of £455,000 and a bonus opportunity of up to 425 per cent of his base pay. He will also be granted a long-term incentive plan of up to 375 per cent of his salary.

Formica said he was “proud” to have worked at the company as it “navigated an extremely challenging period for the business and markets”.

He added that Jupiter had “made significant progress” by broadening its business model so that it had “the right building blocks in place to support long-term growth”.

Pease said that Formica had been “an excellent leader throughout a highly challenging period for the business, the industry and indeed the world”.