Vanguard adds Scottish firm to stock fund team

BOSTON, May 16 (Reuters) - Vanguard Group said on Friday it has added a fourth firm to a three-member team managing a large foreign stock fund, a move that was criticized by an analyst.

The second-biggest U.S. mutual fund manager said privately owned Edinburgh Partners has joined AllianceBernstein (AB.N: Quote, Profile, Research), Lazard Asset Management LLC, a unit of Lazard Ltd (LAZ.N: Quote, Profile, Research), and Hansberger Global Investors in managing its $9.3 billion International Value Fund.

Vanguard did not say specifically why Edinburgh was added. The Scottish firm, which has $7.9 billion in assets under management, employs a "concentrated, low turnover, value-oriented investment approach," it said in a statement.

"It's hard to figure just what Vanguard's intent is here," Daniel Wiener, editor of the Independent Adviser for Vanguard Investors newsletter, wrote in a note.

Wiener said a fourth manager is being added to a fund "that has seen its relative performance against various international indices wane as more and more cooks have been added to the broth-making."

The fund has returned 8.6 percent in 2008 through Thursday's close against the 7.30 percent return of the MSCI EAFE index, according to data from Lipper Inc.

Vanguard said Sandy Nairn, chief executive and co-founder of Edinburgh Partners, and Christine Montgomery, investment partner of the firm, will be portfolio managers to the fund.

It did not say how much in assets Edinburgh will manage or how the assets will be split among the four managers. As of Oct. 31, AllianceBernstein managed 37 percent of the fund's assets, Hansberger handled 36 percent, Lazard managed 24 percent and 3 percent was held in a cash pool, it said.

Vanguard managed nearly $1.3 trillion in assets as of end-April. (Reporting by Muralikumar Anantharaman; Editing by Gary Hill)