New Star Asset Management was founded in June 2000 by John Duffield, the company's chairman and former chief executive of Jupiter Asset Management. The company was authorised by IMRO (now superseded by the FSA) in December 2000 and began trading at the end of January 2001 with the ambition of growing through acquisition and the launch of new funds.
The company's acquisition of WorldInvest, a London-based global investment manager established in 1988 and previously owned by Union plc, was completed on 31 December 2000. The acquisition of WorldInvest, subsequently renamed New Star Institutional Managers, provided New Star with a base of approximately £1.1 billion of funds under management as well as an operating platform.
Over the following three months contracts for the management of three investment funds were transferred from Jupiter to New Star and in April the company raised £25m of development capital from some of the world's leading institutions and private investors at £80 per share, placing a value on it of £129m.
In June 2001 New Star raised £90m for a new investment trust, New Star Enhanced Income Trust.