UK - Investment manager Morgan Stanley Quilter (MSQ) has not been reappointed as fund manager of the UK's General Lighthouse Fund (GLF), it emerged today.

The Department of Transport, which has been looking for investment managers for the fund since April after the contract with both Morgan Stanley and HSBC UK came to an end, has reappointed HSBC, but not MSQ.

Instead, on September 26, the GFL under stewardship of the DfT also appointed fund managers Baillie Gifford and Martin Currie for the fund's two investment portfolios.

In April 2000 the investment fund was split between Morgan Stanley Quilter and HSBC Asset Management; in addition to the investment portfolio, MSQ also managed the fund's cash reserve, into which all light dues levied on commercial vessels calling at ports in the British Isles are paid.

Though MSQ declined to comment, earlier this month it was reported that Morgan Stanley has put Quilter, its UK wealth-management company, up for sale with a price tag of £210m.

However, this is not the reason for not reappointing MSQ, "they were part of the re-tendering process and were part of the final shortlist of the managers that applied, but they were just beaten by other managers," a spokesman for the fund said.

HSBC Investments will now take over MSQ's task of managing the cash reserve, and the two new fund managers will manage the fund's two portfolios, one in UK and overseas equities, and the other in fixed income.

The spokesman did not want to disclose more specific figures with regards to the asset allocation.

According to the DfT the fund, whose assets are managed similar to a UK pension fund, maintains an investment portfolio "in connection with its operations, which is expected to remain in the region of £60m to £80m over the next few years".

In 2004 GLF had a total cash reserve of £83m and because the fund has effective charitable status, the fund's income and capital appreciation of the fund are tax-free.