Ascalon Capital Managers has sold two of its 11 boutique funds following the appointment of a new chief executive.

The boutique manager, which is jointly owned by St George and Kaplan Funds Management, sold its holdings in Sigrun Asset Management and Fortuna Funds Management two weeks ago.

The sale was initiated by former Challenger Financial Services executive and Ascalon's new chief executive Andrew Landman.

He took the helm a month ago from Nick Basile, who departed the group for nabInvest.

Landman decided to sell the two boutiques because he did not believe in their business model.

Sigrun is a high-conviction manager that manages long-only Australian equities. Ascalon acquired a 50 per cent stake in the company in mid-2008, but Landman had problems with the structure of Sigrun's products.

"They did not get the process down correctly ... I've got better investment professionals in the other boutiques to deliver what I need," Landman said.

Fortuna manages a residential property fund and Ascalon bought a stake in the boutique at the end of 2005.

"I feel uncomfortable selling a wrapped-up portfolio because I think Australian investors have easy access to and enjoy directly owning residential property."

He said the current number of boutique fund managers in Ascalon was about right, but indicated more divestments could follow if the market remained subdued.
 
Landman's swift actions in consolidating Ascalon are indicative of a change in the parent companies' strategy towards the business.

Last year, St George and Kaplan were looking to sell Ascalon, but Landman said a sale is now off the table.

"I'm pleased that they've made positive views to me, otherwise I wouldn't be here," he said.