The board of the Fundsmith Emerging Equities Trust (FEET) has announced that Terry Smith will be handing over the day-to-day management of the trust to Michael O'Brien and Sandip Patodia.
The duo, who joined Fundsmith ahead of the launch of the trust in 2014 and have been at the core of the management team of the vehicle, will take over the trust as portfolio manager and assistant portfolio manager, respectively, as of 31 May.
The board said Smith will provide advice and support to the pair in his capacity as chief investment officer. Jonathan Imlah and Tom Boles will continue to assist as research analysts.
Additionally, the board is also set to announce at the AGM later today that the annual management fee on the trust will go down from 1.25% to 1%, also with effect from 31 May.
Martin Bralsford, chairman of FEET, commented: "The promotion by Fundsmith LLP of Michael and Sandip to portfolio manager and assistant portfolio manager reflects the prominent roles they have had for some time and is a natural progression of the team.
"The board look forward to working more closely with Michael and Sandip with the ongoing support of Terry in his capacity as Fundsmith's chief investment officer."
Smith added: "I am delighted that the significant role played by Michael and Sandip in the formation of the fund and its ongoing activities is being recognised.
"The initial success of Fundsmith's other investment trust has made me realise that my oversight as CIO, with dedicated fund managers doing the day-to-day work, has worked extremely well and I believe the changes we are announcing today will help deliver the long-term outperformance that we seek.
"The fee reduction also brings the charges closer into line with our other funds whilst recognising the greater geographical research coverage that we have to maintain on FEET."
Commenting on the news, Ryan Hughes, head of active portfolios at AJ Bell, said that despite seeming like a worrying change the move would in reality mean little change to how the portfolio is managed, with the two managers following "the exact same philosophy and process".
"Both have been involved in the management of the trust since inception and therefore are fully versed with the current holdings," he said.
"More welcome is news that the annual fee is being cut by 0.25%, however, even with this cut, the trust still looks expensive with ongoing costs of 1.27%, particularly with such lacklustre performance over the past five years."
He added: "Investors should be aware that the current positioning of the trust is vastly different to the benchmark with a huge underweight to China and overweight to India at a country level while the trust has nearly 70% in consumer staples companies.
"This may well explain the significant underperformance versus the index over the past five years and investors should understand that this trust is highly likely to continue to behave very differently to the benchmark."