Examples of a fund's board of directors replacing an incumbent advisory firm with one of their own choosing are few and far between, but Tucson, Ariz.-based Davis has been there twice when lightning struck.
Last month, the independent directors of the Clipper Fund board picked Davis to replace Pacific Financial Research as that $6.3 billion fund's investment adviser.
In a telephone interview, Christopher Davis, Davis' New York-based chairman and chief executive officer, said the previous time he recalled this happening was in 1993, when the board of the Selected Funds family of funds rejected incumbent Kemper Corp. in favor of Venture Advisers LP, run by Mr. Davis's father, Shelby M.C. Davis. (The elder Mr. Davis renamed the firm Davis Selected Advisers in late 1995.) With more than a decade between then and now, it's clear that earlier move "didn't start a cascade," said Mr. Davis. He declined to predict a rash of similar board-dictated manager changes in the future.
Still, if there is a pickup, Davis Selected might have more claim than most to be the choice of discerning independent directors.
