Exclusive: Old Mutual may sell $45 billion Dwight: sources
(Reuters) - Old Mutual Asset Management, a subsidiary of London-based investment company Old Mutual PLC, is looking to sell Dwight Asset Management Company LLC, according to several sources familiar with the discussions.
Dwight, which had $45.3 billion in assets as of June 30, is an institutional fixed income asset manager that specializes in stable-value funds for retirement plans.
Zach Kouwe, a spokesman for Old Mutual, declined to comment. Kristel Garneau, a spokeswoman for Dwight, didn't return a call or e-mail.
Dwight advises three fixed-income funds for Old Mutual Asset Management. The three funds, the Old Mutual Dwight High Yield Fund, the Old Mutual Dwight Short Term Fixed Income Fund OIRAX.O and the Old Mutual Dwight Intermediate Fixed Income Fund altogether have $240 million in assets, according to Lipper.
Morgan Stanley is a banker on the deal, sources told Reuters. A spokesman for Morgan Stanley declined to comment.
Old Mutual PLC announced last year it wanted to do a partial IPO of its asset management unit. In February, the firm appointed Peter Bain, a former Legg Mason executive, as president and chief executive officer of Old Mutual Asset Management.
Old Mutual may be selling Dwight as part of its effort to streamline its business pre-IPO, said Geoff Bobroff, a mutual fund consultant.
"The stable value products they are selling don't really fit into the general profile of a bond shop," Bobroff said. "It's sort of a stand alone."
Boston-based Old Mutual Asset Management has 18 affiliates and had $260 billion in assets under management, as of June 30.
Earlier this month, Reuters reported that Old Mutual Asset Management is selling its $2.3 billion U.S. mutual fund business to Touchstone Investments because Bain had decided that it was not core to the business. That deal is still in the works and is expected to be announced soon, one source familiar with the deal said.
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