Deals & People February 25, 2009

Forward Absorbs, Assimilates Kensington Funds

Forward Management, LLC, investment adviser to the Forward Funds, will add the Kensington Funds from the Kensington Investment Group, Inc., to the Forward Funds series.

Reported by

Nevin E. Adams

According to a press release, the addition, pending shareholder approval in April, would create a combined fund family offering investors 35 mutual funds in no-load and load-share classes with more than $3.7 billion in assets under management. Following shareholder approval, Kensington Funds will be branded as Forward Funds.

After Match

The Kensington Select Income Fund (KIFAX), the Kensington Global Infrastructure Fund (KGIAX) and the Kensington Strategic Realty (KSRAX), will maintain their investment strategies and continue to be managed by current portfolio managers.

Kensington’s Global and International Real Estate Funds (KGFAX, KIRAX) will merge to create the Forward International Real Estate Fund. The portfolio will continue to be co-managed by Paul Gray and Michael McGowan. Additionally, Kensington Real Estate Securities (KREAX) Fund will merge into Forward Real Estate Fund1 (FFREX/FPREX).

Forward Real Estate Fund was launched in 1999 and, according to the announcement, “has a solid, long-term track record of investing in U.S. real estate management companies using a core-focused approach.” The fund is managed by Richard Imperiale, a veteran of real estate investing. According to the press release, the management transition of these funds will bring additional expertise and resources that will allow Kensington’s real estate investment team to gain an increased focus on the international arena.

Third Acquisition

The acquisition of the Kensington Funds marks Forward Management’s third acquisition in the last year. Forward acquired Accessor Capital Management LP (Accessor), investment adviser to the Accessor Funds in 2008 (see “Forward Management Picks Up Investment Adviser’), as well as the assets of Berkeley Capital Management, LLC (Berkeley), including the investment portfolios and team responsible for managing the Global Dividend, International Dividend, U.S. Dividend and SmallMid Core Portfolios.

According to the press release, this transaction also will significantly expand Forward’s income/dividend-oriented product offerings. The Kensington portfolio management team will join the teams from Berkeley and Accessor, further strengthening Forward’s internal asset management capabilities.