Legal and General Opposition A notable event in the City
was the appearance at the annual general meeting of the LEGAL AND GENERAL of Mr Oliver Stutchbury, the managing director of the SAVE AND PROSPER group of unit trusts, to protest against the surprising absence of any increase in dividend on the triennial valua- tion. This is the first time that an important unit trust management has intervened in the affairs of a company in which its unit trusts are heavily interested. And not before it was time. Institu- tional investors do not like to throw their weight about in company meetings, but it is right and proper that large equity shareholders should make their views known to the directors whom they vote into office. The unit trusts are now responsible for £584 million of funds and the Save and Prosper group for f210 million. There is ground for criticising the big life assurance com- panies who go on expanding their business in with profits' policies on the spur of higher and higher bonuses regardless of the ultimate cost to shareholders. If the Legal and General wants to ignore its shareholders and work only for its policy-holders it should turn itself into a mutual society and buy out its share-owners. Legal was, of course, badly hit by the new taxation and by the fact that a large part of its assets pro- duced non-franked income. This unhappy occa- sion calls attention to the fact that unit trusts which are specialised in insurance shares or in investment trusts are liable to risks which a widely spread investment portfolio is not.
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