Nelson Peltz Gets Janus Board Seats, Amping Up Pressure on Firm

(Bloomberg) -- Janus Henderson Group Plc, which has struggled to stem a client exodus of since its merger more than four years ago, is now facing extra pressure from its largest shareholder to turn around performance.

Nelson Peltz, an investor with a long winning streak of bringing major change to companies, is joining Janus Henderson's board along with Trian Fund Management co-founder Ed Garden, the firms said Tuesday.

The move will give Peltz and Garden more say in how Janus Henderson is run. The asset manager, whose Chief Executive Officer Dick Weil will retire at the end of March, has been finding it hard to compete in an industry buffeted by shrinking fees and the success of passive investing strategies.

“As the company's largest shareholder, Trian believes strongly in the future of Janus Henderson,” Peltz and Garden said in the statement. “We see numerous operating and strategic opportunities ahead and look forward to working with the Janus Henderson board and its leadership team.”

Trian, which owns a 17% of Janus Henderson, has been talking with the firm's leadership about ways to improve its performance since taking a stake in the company more than a year ago.

Peltz and Garden will leave the board of rival money manager Invesco Ltd. after boosting total shareholder returns by 109% since Trian first disclosed its stake in the company. Total shareholder returns at janus have been about 80% since Trian first disclosed its stake in 2020.

Trian, co-founded by Peltz, Garden and Peter May, first disclosed its stakes in Janus and Invesco in October 2020. Peltz has said smaller asset managers such as Janus and Invesco need to grow through consolidation to compete with dominant players such as BlackRock Inc.

Struggling Business

The merger that formed Janus Henderson in 2017 was designed to create a bigger, more global asset manager with a leg in Europe and the U.S. But the firm, which focuses on actively-managed investment funds, has struggled with clients favoring cheaper, index-linked products.

Janus Henderson has seen 16 straight quarters of outflows of investor money including $5.2 billion in the third quarter, according to data compiled by Bloomberg. The firm, which will report earnings on Feb. 3, said in a statement Tuesday it would expand its board by two seats to 12 members to make room for the new appointments.

Trian, which remains Invesco's second-largest holder, continues to believe “strongly in the Invesco franchise, its people and future potential,” Peltz and Garden said in a separate statement. Invesco Chairman Richard Wagoner, thanked the pair for their partnership over the past 14 months.

“Nelson and Ed have an impressive track record as long-term investors and have a deep appreciation for the significant growth opportunities within the asset management industry,” he said.

Trian shuns the term activist investor and prefers to be called a “highly engaged shareowner.” It has pushed for changes at some of the largest and most prominent companies in the world, including Procter & Gamble Co., General Electric Co., and PepsiCo Inc. It also recently also took a sizable stake in Unilever Plc, according to people familiar with the matter.