Federated Investors, Inc.
is set to acquire certain assets of Rochdale Investment Management LLC that relate to the management of the Rochdale Atlas Portfolio
, a $321 million mutual fund that invests in international stocks. Under the agreement, assets of the Rochdale fund will be transitioned to the new Federated InterContinental Fund
, which will continue the investment operations of the Rochdale Atlas Portfolio.
Federated Investors, Inc. (NYSE: FII - News), one of the nation's largest investment managers, reached a definitive agreement to acquire certain assets of Rochdale Investment Management LLC that relate to the management of the Rochdale Atlas Portfolio, a $321 million mutual fund that invests in international stocks. J. Christopher Donahue, president and chief executive officer of Federated, and Carl Acebes, chairman of Rochdale Investment Management LLC, announced the agreement. As part of the agreement, it is expected that the assets of the Rochdale Atlas Portfolio will be transitioned into the new Federated InterContinental Fund, which will continue the investment operations of the Rochdale Atlas Portfolio.
The Rochdale Atlas Portfolio has an overall 5-star Morningstar Rating among the 546 foreign large-blend funds in Morningstar's Foreign Large-Blend Category for the period ended March 31, 2007. Morningstar ratings are based on risk-adjusted total return. The overall rating is derived from a weighted average of the fund's 3-, 5- and 10-year average annual returns, as applicable.
Based on total return, the Rochdale Atlas Portfolio has outperformed its Lipper International Multi-Cap Core Category average for the 1-, 3- and 5-year periods as of March 31, 2007, where it ranked in the 13th, third and sixth percentiles of its Lipper category, respectively. For the periods ended March 31, 2007, the Rochdale Atlas Portfolio ranked 44 out of 344 funds for 1 year; 6 out of 258 for 3 years; and 11 out of 206 for 5 years.
"The strength of the Rochdale Atlas Portfolio's historical performance illustrates the ability of its management team to navigate international markets through a variety of economic conditions," said J. Christopher Donahue. "The unique country-specific investment approach makes Rochdale Atlas Portfolio an ideal opportunity for Federated to expand our international equity product line."
"Rochdale chose to enter into this strategic transaction because it fits well with the three tenets of our firm: integrity, intelligence and innovation in investment management," said Carl Acebes. "After the transaction closes, Rochdale's clients holding shares of the new Federated InterContinental Fund will have access to Federated's significant global resources, which is increasingly important given the evolving complexities of the international investing environment. In transitioning the portfolio, we are pleased that our clients may continue to have access to the unique country allocation process and investment intelligence that Rochdale developed over the past decade."
The sale is expected to close in the third quarter of 2007. As a part of the agreement, Federated will acquire Rochdale's proprietary quantitative investment model used to manage the Rochdale Atlas Portfolio. Current management team members, Audrey H. Kaplan and Geoffrey Pazzanese, will join Federated and serve as co-managers of the Federated InterContinental Fund, which will continue the investment operations of the Rochdale Atlas Portfolio. The Rochdale Atlas Portfolio invests in companies in foreign markets, both developed and emerging, believed to have favorable macroeconomic outlooks where markets are likely to outperform relative to the world based on fundamental valuation and financial and economic attributes. The quantitative model is used to strive to select countries for investment that have rising earnings expectations, lower valuation relative to growth, favorable interest rate environments and positive technical factors.
Kaplan serves as portfolio manager and senior vice president-quantitative research at Rochdale. She has more than 18 years experience in the industry, including European quantitative strategy for Merrill Lynch in London, global emerging markets research with Robert Fleming in London and equity, fixed- income and derivative analysis with Salomon Brothers in Tokyo and New York. Pazzanese, with seven years of industry experience, serves as senior quantitative analyst of the Rochdale Atlas Portfolio. His previous experience includes working on the sell side with the international quantitative strategy group at Merrill Lynch and with the Italian engineering firm AXIS S.p.A. in Florence, Italy, as a sales and marketing manager.
The transaction has been approved by the Board of Directors of Federated Investors, Inc. The Federated Mutual Fund Board of Trustees and the Rochdale Investment Trust Board of Trustees have both approved the reorganization of the Rochdale Atlas Portfolio into the Federated InterContinental Fund, which will be a new shell portfolio created for the purpose of continuing the investment operations of Rochdale Atlas Portfolio as part of the Federated fund complex. The Rochdale Board of Trustees will be seeking the vote of Rochdale Atlas Portfolio shareholders to reorganize the fund into the new Federated InterContinental Fund. The reorganization is subject to the approval of the Rochdale Atlas Portfolio shareholders.
Federated Investors, Inc. is one of the largest investment managers in the United States, managing $237.4 billion in assets as of Dec. 31, 2006. With 148 mutual funds and a variety of separately managed account options, Federated provides comprehensive investment management to more than 5,400 institutions and intermediaries including corporations, government entities, insurance companies, foundations and endowments, banks and broker/dealers. For more information, visit http://FederatedInvestors.com.
Rochdale Investment Management LLC is a private investment counseling firm specializing in intelligently personalized portfolio management for high net worth individuals. Based in New York City with offices nationwide, Rochdale manages $2.5 billion in assets as of March 31, 2007. Working in concert with each client's financial advisor or CPA, Rochdale develops and manages a customized portfolio for each client. Investment strategies are implemented through proprietary separate accounts and funds. The firm's hallmark is providing integrity, intelligence and innovation in investment management. For more information, visit http://www.rochdale.com.
Certain statements in this press release, such as those related to Federated's expansion of its international equity product line constitute forward-looking statements, which involve known and unknown risks, uncertainties and other factors that may cause the actual results, levels of activity, performance or achievements of Federated, or industry results, to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Among other risks and uncertainties is the ability of Federated to successfully expand its international equity product line and the risk factors discussed in Federated's annual and quarterly reports as filed with the Securities and Exchange Commission. Many of these factors may be impacted by the ongoing threat of terrorism. As a result, no assurance can be given as to future results, levels of activity, performance or achievements, and neither Federated nor any other person assumes responsibility for the accuracy and completeness of such statements.
Federated Securities Corp. is distributor of the Federated funds.
RIM Securities LLC is distributor of the Rochdale funds.
Rochdale Investment Management and RIM Securities are not affiliated with Federated.
Federated separately managed accounts are made available through Federated Investment Counseling and MDT Advisers, both registered investment advisors.
Standardized returns for the Rochdale Atlas Portfolio for the quarter ended March 31, 2007 are as follows: Average Annualized Total Return at NAV (Net Asset Value) for 1-year, 3-year, 5-year, and since inception: 21.19%, 24.31%, 19.14%, and 11.86%, respectively; Average Annualized Total Return at POP (Public Offering Price, reflecting maximum front end sales charge of 5.75%) for 1-year, 3-year, 5-year, and since inception: 14.22%, 21.88%, 17.73%, and 11.09%, respectively.
Performance data quoted represents past performance. Past performance does not guarantee future results. Investment return and principal value of an investment will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted. The most recent month-end performance can be found on at http://www.rochdale.com.
Investing in international companies carries risks such as currency fluctuation, interest rate fluctuation, and economic and political instability.
A fund's investment objectives, risks, charges and expenses must be considered carefully before investing. The prospectus contains this and other information about the investment company, and it may be obtained by calling 800-245-9888, or visiting http://www.rochdale.com. Please read the prospectus carefully before investing. RIM Securities LLC, 570 Lexington Avenue, New York, NY 10022.
For each fund with at least a 3-year history, Morningstar calculates a Morningstar Rating(TM) based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a fund's monthly performance (including the effects of sales charges, loads, and redemption fees), placing more emphasis on downward variations and rewarding consistent performance. The top 10% of funds in each category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars and the bottom 10% receive 1 star. (Each share class is counted as a fraction of one fund within this scale and rated separately, which may cause slight variations in the distribution percentages.) The Overall Morningstar Rating for a fund is derived from a weighted-average of the performance figures associated with its 3-, 5- and 10-year (if applicable) Morningstar Rating metrics. Ratings are for Class A Shares; other classes may have different performance characteristics. For the 3-year period ended 3/31/07, the Rochdale Atlas Portfolio (RIMAX) received 4 stars and was rated among 546 funds. For the 5-year period ended 3/31/07, the Rochdale Atlas Portfolio (RIMAX) received 5 stars and was rated among 446 funds. Past performance is no guarantee of future results.
Morningstar Category identifies funds based on their actual investment styles as measured by their underlying portfolio holdings over the past three years. If the fund is less than three years old, the category is based on the life of the fund. ©2007 Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.
A prospectus/proxy statement with respect to the proposed transaction will be mailed to shareholders and filed with the Securities and Exchange Commission (SEC). Investors are urged to read the prospectus/proxy statement because it contains important information. The prospectus/proxy statement and other relevant documents will be available free of charge on the SEC's Web site at http://www.sec.gov or by calling 1-800-341-7400.
Source: Federated Investors, Inc.
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