Two asset management firms have been fined and a third censured over breaches of competition law by the UK’s Financial Conduct Authority.
Hargreave Hale was fined £306,300 (€353,000) and River and Mercantile Asset Management (RAMAM) was fined £108,600 by the UK’s financial regulator.
A third company, Newton Investment Management was not fined as it had been granted immunity under the competition leniency programme.
The FCA said that the firms had shared strategic information, on a bilateral basis, between competing asset management firms during an initial public offering and a placing, shortly before share prices were set.
In addition the firms disclosed or accepted otherwise confidential bidding intentions, in the form of the price they were willing to pay and sometimes the volume they wished to acquire.
“This allowed one firm to know another's plans during the IPO or placing process when they should have been competing for shares,” the FCA said in a statement.
Christopher Woolard, executive director of strategy and competition at the FCA, said: “This is our first case using our competition law powers and demonstrates our commitment to taking enforcement action to protect competition.
“Asset management firms must take care to avoid undermining how prices are properly set for shares in both IPOs and placings. Failure to do so risks them acting illegally.”
In a statement refuting the FCA’s judgement, Hargreave said: “Based on our initial review of the FCA’s decision in connection with its Competition Act investigation, we believe that the FCA has made a number of legal and factual errors in concluding that Hargreave Hale infringed competition law and we are exploring our options with our legal advisers.”
Earlier this month the FCA fined a former Newton fund manager for conduct in relation to an IPO and a shares placing relating to two companies.
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