Financial Daily from THE HINDU group of publications
Friday, Feb 15, 2002
Financial Daily from THE HINDU group of publications Friday, Feb 15, 2002 |
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Mergers & Acquisitions Markets - Mutual Funds Corporate - Mergers & Acquisitions Sundaram Fin to buy out Newton stake in AMC BL Research Bureau
THE Sundaram Finance group has decided to acquire the 39-per cent stake owned by the UK-based Newton Investment Management in Sundaram Newton Asset Management Company. The Sundaram Finance group already holds a 61-per cent stake, while 39 per cent is held by Stewart Newton Holdings (Mauritius), a subsidiary of Newton Investment Management. Sundaram Newton Asset Management has a paid-up capital of Rs 15 crore. The change of controlling stake is consequent to the global acquisition of Newton Investment by Mellon Financial Corporation in 1998. Mr Viji Santhanam, Vice-Chairman of Sundaram Finance, said in a statement that following the takeover, there had been a "shift in strategic perspectives" because of which Sundaram Finance had decided to buy out Newton's stake. Mellon, which has $2.6 trillion in assets under its management, administration and custody, is a provider of an array of financial services and is the sixth largest asset management company in the world. Under its investment management services, the company manages $500 billion and focuses on high net worth and corporate clients. The company uses the brand, Dreyfus, for its investment management services. Sundaram Newton AMC manages Rs 800 crore in net assets under its mutual fund schemes in India. It manages six funds — pure growth and bond fund, balanced fund, money fund and gilt fund (both for short-term surpluses) and tax-saving fund. The joint venture partners have dubbed this disengagement from the joint venture as an amicable one. However, investors in the schemes of Sundaram Mutual Fund may be interested in watching for the impact, if any, of this development on the fund management style. Since its investment in the asset management company, Newton has been an active contributor to the fund management function.
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