UK - The long-awaited legal battle between two dozen pension funds and asset manager Henderson Group is expected to take place in the first half of 2012, following months of behind-the-scenes negotiations to reach an out-of-court settlement.

A source close to the case, who asked to remain anonymous, said: "Throughout the process, Henderson appeared to take the view that the pension funds would go away, but that was never going to be the case.

"There is so much anger about this that only a few of the funds from the original group of investors have dropped out."

Once Henderson's acknowledgement of the writ has been received, further submissions will be made, and a hearing will be set for the first half of next year in the Queen's Bench division of the Commercial Court.

The pension funds are suing Henderson Equity Partners (GP) Limited, Henderson Equity Partners Limited (subsidiaries of Henderson Group) and Henderson PFI Secondary Fund II LP for as much as £450m (€540m) in damages for alleged breach of mandate and misrepresentation.

The claim consists of £170m for losses on the fund and £280m for the gains the pension funds believe could have been achieved had the fund been invested in a range of PFI and infrastructure projects as they expected.

The asset manager's shares fell by 3% last week on news that the writ had been served.

Henderson chief executive Andrew Formica led negotiations with the investors. A spokesman at the asset manager said Henderson chairman and former deputy governor of the Bank of England Rupert Pennant-Rea had not been involved in the negotiations recently.

Henderson denied all the claims, saying: "We have considered these complaints carefully. We are confident we have no legal liability to investors in this fund. We will vigorously defend these proceedings."

 

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