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Fund Times: Tweedy, Browne Launches New Global Dividend Fund

Plus, two executive-level changes elsewhere, and more.

Morningstar Analysts, 09/10/2007

Tweedy, Browne's first new fund in 14 years, Tweedy, Browne Worldwide High Dividend Yield Value, launched Wednesday. Its five-comanager team is the same one that manages Tweedy, Browne Global Value TBGVX. That foreign small/mid-value fund has struggled in recent years but still has a strong record.

Worldwide High Dividend Yield Value will differ from Global Value in two key aspects. First, Tweedy, Browne will not hedge currency risk (a factor that has contributed to Global Value's recent struggles). Second, according to the firm's commentary on the fund, it is likely to invest in larger-capitalization stocks. That's no concern, however, because Tweedy, Browne will still apply the same value-oriented strategy here as it has long done at its other offerings. This strategy helped Global Value preserve capital much better than most rivals when international markets saw sharp losses during 2000 and 2001.

First Eagle Funds' Advisor Sells Minority Stake
The advisor to the First Eagle Funds, Arnhold and S. Bleichroeder Advisers, announced that its parent company, Arnhold and S. Bleichroeder Holdings (ASB Holdings), has sold a minority stake in ASB Holdings to a private-equity firm, TA Associates.

Spokespeople for First Eagle say that ASB Holdings, a private, family-owned firm, remains overwhelmingly owned by family members. The minority stake purchased by TA Associates amounts to less than 25%. They say the main reason for the transaction is to provide a way to offer equity participation in the advisor for key investment personnel at First Eagle as a means to better ensure that those people stay with the firm.

Two executives from TA Associates will join the board of ASB Holdings, as that board expands from seven members to nine. The First Eagle spokespeople say, though, that they do not expect any changes in the firm's culture or investment process or any changes to the funds.

Retaining longtime analysts, some of whom are slated to succeed Jean-Marie Eveillard as managers of First Eagle funds as he eases away from management responsibilities over the next couple of years, is important for Arnhold and S. Bleichroeder. Earlier this year, the firm was caught off-guard when Charles de Vaulx, lead manager of four First Eagle funds, suddenly departed. Eveillard came out of retirement to fill the gap, but he does not plan to stay on as a manager beyond 2009.

TA Associates previously has made investments in a number of other asset-management companies that offer mutual funds, including Affiliated Management Group and Numeric Investors.

Founding Family Member Leaves American Century
James Stowers III, whose father James Stowers Jr. founded American Century Investments in 1958, is leaving the company to pursue new opportunities. Stowers III joined American Century in 1981 and, during his 26 years at the firm, held myriad positions. Among the most notable were his leadership of flagship growth fund American Century Ultra TWUAX in the early 1990s. He also led efforts to enhance the firm's growth investing process and quantitative algorithms during the late 1990s. His departure is significant, as the Stowers family is still the private majority-owner of the firm.

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