With purchase of two funds, Hennessy sets sights on growth

Monday, December 15, 2008, 12:00 pm

By Jenna V. Loceff, Business Journal Staff Reporter

NOVATO – Hennessy Advisors Inc. last week announced agreements to purchase two Tamarack funds, the Large Cap Growth Fund and Tamarack Value Fund. The combined assets are valued at just under $200 million.

The two funds purchased are under RBC’s Voyager Asset Management.

“Even though our earnings are down, our plan is to grow organically through sales and acquisitions,” said Neil Hennessy, president and chief executive officer of Hennessy Advisors based in Novato. “In 2007, the market was hot as can be, and we continued to save our money, which is how we can afford to make this move.”

Mr. Hennessy said the value fund, with assets at $130 million, will continue to be managed by Voyager.

He said they have not been in the sub-adviser business previously, but in July, they brought on Kevin Rowell, the former president of Pioneer funds, who has experience in that market.

“This transaction is a very good deal for us,” Mr. Hennessy said. “And we are still looking to acquire. While most people are pulling back and changing strategies, we are maintaining. The worst thing you can do in slow times is change what has made you successful.”

He said Hennessy has almost $13 million in cash and $6 million in debt.

“We will just keep going forward. At some point in time the market is going to turn.”

Hennessy earlier announced earnings per share of $0.28 for the period ending Sept. 30, 2008. That is a 60 percent decrease compared with last year’s $0.70 per share. Assets were $876 million at Sept. 30, down from $1.72 billion at the same time last year.