EDINBURGH Fund Managers (Edinburgh) claimed it may lose only #250,000 of its #2m annual fee for managing Dunedin Worldwide, after enticing #112m of the to-be-liquidated fund's #400m of net assets into a successor

investment trust.

The 101-year-old Dunedin Worldwide announced yesterday that shareholders owning 28.4% of it had opted to roll their holdings over into Edinburgh Worldwide Investment Trust.

In addition to this #112m, Edinburgh will retain another #22m of Dunedin Worldwide's assets in the Edinburgh Investment Company, a newly created open-ended investment company (Oeic) with global and emerging markets sub-funds.

In the context of recent restructurings by two other international investment trusts, Mike Balfour, Edinburgh's chief investment officer, said only 10% of Kleinwort Overseas had been retained by its manager and that Morgan Grenfell had retained only 20% of the funds in its Overseas investment trust.

Edinburgh has retained about one-third of Dunedin Worldwide.

Balfour said Edinburgh would lose only about #250,000 of annual revenues, assuming Edinburgh Worldwide's performance was such that it generated the maximum annual management fee of 0.8% of assets. The minimum fee is 0.6% and the movement in the new fund's net asset value must be above that of its benchmark by 2% to trigger the maximum fee in any given year.

Balfour's estimate appears to assume Edinburgh Worldwide gears up heavily and may also factor in the transfer of three of Edinburgh's unit trusts to the new Oeic.

But Edinburgh will receive about #2m by charging exiting shareholders 0.75% of their assets for taking cash.

Shareholders approved Dunedin Worldwide's winding-up and reconstruction overwhelmingly at meetings yesterday.

The large institutional shareholders have opted for cash and the successor investment trust will be held almost entirely by private investors and small institutions.

Iain Beattie, who had joined Edinburgh as head of emerging markets outwith the Pacific Basin, took over recently from David McCraw as its manager and Beattie will run Edinburgh Worldwide.

Dunedin Worldwide yesterday declared a second interim dividend of 1.4p per share in connection with the reconstruction plans.

Shares in Edinburgh slipped 3p to 575p yesterday. Dunedin Worldwide's shares stood still at 215p.

Dealings in the new investment trust's shares, which will be allocated on a one-for-one basis to Dunedin Worldwide shareholders who elected to join it, will begin on July 10.