CHINA: Regent Pacific Group - Hambros faces call for break-up.

When Jim Mellon started the Hong-Kong based investment group Regent Pacific seven years ago, he decided to target closed-end funds whose shares were selling at a price below their net asset value and help shake up their performance. Fourteen funds later, he has a business that is expected to turn in profits this year of $100 million, compared with $31 million last time.

'In every case we've been active in calling for change,' he says. 'If we don't succeed in persuading management, we move to the public route by calling for an EGM. We've got to this size by being aggressive and have a messianic belief that shareholders - not customers, not staff - own companies.'

Latest victim to fall prey to the Mellon doctrine on shareholder value is Hambros, the British merchant bank whose shares have performed poorly at a time when banking stocks have soared.Using surplus cash generated by the fund management business, Mellon bought a 3.5% stake in Hambros last year. He talked to management in private about how it could improve performance but says he was stonewalled.