A fund manager specializing in European small cap companies has taken a 4% stake in struggling property services firm DTZ, it was revealed today.

Montanaro, led by former Merrill Lynch and Drexel Burnham Lambert investment expert Charles Montanaro, notified DTZ of the purchase on Christmas Eve.

Montanaro has around E1bn under management, and invests in targeted smaller companies in the hope of making greater returns.

It says that it likes to `add value’ to companies it invests in by taking an `active role’ in their management.

It invests in companies with `strong products and services’ across a `broad customer base’. This fits the bill with DTZ.

However, although it still has a respected brand the group has financial difficulties, and on December 19 revealed plans for a £55m share issue to pay down debt owed to Royal Bank of Scotland.

It has a `firm commitment’ from major shareholder and French group SGP to take up £40m of shares.