Termination prompts Friess to target shareholder votes in 2 AMG funds

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Friess Associates LLC’s 401(k) plan filed a preliminary proxy statement urging shareholders of two mutual funds managed by Affiliated Managers Group to reject the retroactive termination of Friess as a subadviser for the funds.

The statement is being made in connection with the upcoming special meeting for shareholders of the AMG Boston Common Global Impact Fund and AMG Veritas Global Real Return Fund on May 18, according to a news release Thursday from Friess Associates.

AMG called the special meeting regarding changes to the subadvisers and other components of these and three other AMG funds, according to SEC filings.

Affiliated Managers Group hired Boston Common Asset Management to replace Friess Associates as subadviser of AMG Boston Common Global Impact Fund (previously the AMG Managers Brandywine Fund) and hired Veritas Asset Management to replace Friess as subadviser of the AMG Veritas Global Real Return Fund (previously the AMG Managers Brandywine Blue Fund), according to March 22 SEC filings.

Both new subadvisers are affiliates of Affiliated Managers Group. Friess Associates, the adviser for the Brandywine mutual fund family, became a 100% employee-owned firm in 2013 after employees purchased the 70% stake previously owned by Affiliated Managers Group. The firm retains that structure currently, a spokesman for Friess Associates said in an email.

The Friess Associates LLC 401(k) Retirement Plan, which is the beneficial owner of 119,917.742 and 43,394.539 shares, respectively, of the funds, issued the statement because it said that AMG’s board has “drastically altered” investment objectives and strategies, that AMG benefits more from fee savings than shareholders, that they are being managed without shareholder approval, and that AMG’s board made and disclosed its decision “in a highly irregular manner,” according to the Friess news release.

As of Dec. 31, 2019, the Friess Associates LLC 401(k) Retirement Plan had $43 million in assets, according to its most recent Form 5500 filing.

An AMG spokesman said in an email: “AMG Funds’ Board of Trustees acted in the best interests of shareholders in taking action to lower management fees and offer a high-quality, more differentiated lineup of funds.”

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