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Rating:Decisions, Decisions Not Rated 3.0 Email Routing List Email & Route  Print Print
Friday, January 12, 2001

Decisions, Decisions

Reported by Tamiko Toland

Centurion Capital Group, which doubled its assets under management last year through an aggressive acquisition schedule, has a decision of another sort to make: Foliofn or UNX?

According to Joe Duran, president of Centurion Capital Management, each basket trader has its merits, but the company has to take a number of factors into consideration.

"I would say that there are real advantages to one and real advantages to another and it's a tough decision," said Duran. "My sense is that Folio has real survivability but UNX really wants to work with advisors as its core business plan, so that's the tug of war. That's not to say UNX doesn't have survivability, but those are the two strongest characteristics of each of them."

Furthermore, Centurion's primary issue is one of predation. "We want to make sure that they don't compete against us," he said. "That's our biggest issue."

Centurion's research benefits all the units of its growing organization. Smaller advisors who would otherwise be left in the cold can capitalize off the company's efforts. Their research extends from mutual funds to vehicles like hedge funds and basket traders.

The company has gone on a spending binge, partly fueled by capital from Putnam Lovell Equity Partners. Recently, Putnam Lovell invested $9 million, raising its stake in the company to approximately 40%, not accounting for stock options.

Duran stressed that the company is "very cash-flow positive" and, while it can use the $9 in its expansion plans, had not actively sought out the money. After last year's $1 billion in growth, he would be pleased to see the same results this year. Putnam Lovell supports the company's ambitions.

"Since we've been involved with them, we were aware of the company and the success of the acquisitions and we were aware that, to continue this program, additional capital would be appropriate," said Jeffrey Lovell, chief executive officer of Putnam Lovell Capital Partners. "Therefore, we worked with the company to work out the terms of an additional investment. We're obviously pleased with the investment to date and support the corporate development activity the company is pursuing."

Centurion has been expanding its wrap program activities through acquisitions, with $2 billion under management under Centurion Capital Management and $250 million with Centurion Financial Advisors.

"We have two kinds of acquisitions that we do," he explained. "We do acquisitions of independent advisors with $100 million or more in assets. We had a couple of those in the beginning of 2000. And then we do acquisitions of larger independent advisors who are in the business of managing wraps, either mutual funds or separate accounts."


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