Organizational Changes at Sprucegrove Investment Management

October 20, 2014

Plan sponsors may wish to consider whether this investment news has any implications for the investment options available within their plans. Sun Life Assurance Company of Canada purchases units of the funds listed below, which are established as segregated funds in accordance with the Insurance Companies Act (Canada).

Sprucegrove Investment Management Ltd. (Sprucegrove) announced that Peter Ellement departed from the firm effective August 25, 2014. Mr. Ellement was Co-President, Director and Portfolio Manager and had been an employee at the firm since 1984. Mr. Ellement and Craig Merrigan were appointed co-presidents of the firm after the retirement of Peter Clark in March 2012. The firm confirmed that Mr. Ellement's resignation was requested and received, following a number of senior colleagues who lost confidence in their working relationship with him.

Going forward, the firm will continue to be managed by the firm's Board of Directors, consisting of Shirley Woo, Blake Murphy and Craig Merrigan as well as the Business Management Committee, who are responsible for the day-to-day operations of the firm. Mr. Merrigan is now the sole president of the firm.

Mr. Ellement's portfolio management responsibilities included co-management of the Sprucegrove International Pooled Fund and Sprucegrove Global Pooled Fund.

Changes to the portfolio management teams are as follows:

  • Sprucegrove International Pooled Fund
    Previous Portfolio Management team:  Shirley Woo and Peter Ellement.
    New Portfolio Management team:  Shirley Woo and Arjun Kumar.
  • Sprucegrove Global Pooled Fund
    Previous Portfolio Management team:  Craig Merrigan and Peter Ellement
    New Portfolio Management team:  Craig Merrigan and Erik Parnoja

Arjun Kumar, a 12-year veteran of the firm, has been promoted to Co-Portfolio Manager from Assistant Portfolio Manager. Erik Parnoja has been with the firm for 18 years and is a Portfolio Manager and Director of Research at Sprucegrove.

The firm has confirmed that there will be no changes to the investment philosophy or investment objectives of the above funds. Sprucegrove’s approach remains bottom-up, with a focus on quality and value.

On August 28, 2014, members of Sun Life Financial's GRS Investment Solutions team and International Investment Centre discussed the organizational changes with Sprucegrove in more detail. The firm doesn't anticipate any additional senior level turnover. Sprucegrove confirmed that Peter Ellement owned approximately 10% of the firm and at this time, it remains unclear whether this will be allocated to current partners, new partners, or held within the company.

This is a significant departure from the firm. We will continue to monitor developments at Sprucegrove and provides updates as necessary.

Please contact your Sun Life Group Retirement Services representative.