The MFWire
Manage Email Alerts | Sponsorships | About MFWire | Who We Are

Subscribe to MFWire.com's News Alerts [click]

Rating:Stay Tuned for Details, Says Zurich Not Rated 3.0 Email Routing List Email & Route  Print Print
Wednesday, September 05, 2001

Stay Tuned for Details, Says Zurich

Reported by Sean Hanna, Editor in Chief

Zurich Financial is staying mum on the status of its sale of its investment management arm. Indeed, the firm declined to even confirm the widespread belief in the industry that the core of an effort to raise $4 billion. That effort is thought to include a sale of its US fund unit, Scudder Kemper, according to executives at rival firms. Zurich officials told The Financial Times of London that they will reveal all when the firm reports earnings results this week.

The earnings announcement is expected on Thursday (September 6, 2001).

Among the bidders reported to be submitting bids in The Financial Times are Deutsche Bank's asset management arm and Amvescap, both of those firms declined to comment to the paper. Industry sources in the US add OppenheimerFunds parent MassMutual to the list of suitors. The bids may run as little as $3 billion in a sale. That price would mark a significant discount from what Zurich paid for the unit. The paper reports that suitors may also be asked to enter into a joint venture.

Zurich paid a combined $3.7 billion for the unit. It purchased Scudder in 1997 for a reported $1.7 billion and Kemper in 1995 for roughly $2 billion.

Since buying the units, Zurich has faced trouble integrating the two firm's cultures and sales strategies. Kemper offered all advisor-sold funds, while Scudder was a direct-sales specialist. To resolve the conflict, Scudder added loads to its funds and the Kemper brand name was dropped. That move left advisors selling a new brand in that channel at the expense of losing a known brand.

Sources inside the firm report that the decisions came as Scudder and Kemper executives battled for control of the firm and Scudder executives won.

That battle may have left both retail investors and advisors confused, as investors have pulled some $14 billion from Scudder funds since 1999 (including $2.4 billion so far this year), according to Financial Research Corp.

The firm has also suffered in its defined contribution business after trying to merge the two firms. Scudder let go of a large number of personnel running its 401(k) administrative efforts in the Summer of 2000. Scudder had been a specialist in the market for plans with more than $100 million, while Kemper had focused on the small plan market.  

Stay ahead of the news ... Sign up for our email alerts now

 Do You Recommend This Story?

Return to Top
 News Archives
2020: Q1
2019: Q4Q3Q2Q1
2018: Q4Q3Q2Q1
2017: Q4Q3Q2Q1
2016: Q4Q3Q2Q1
2015: Q4Q3Q2Q1
2014: Q4Q3Q2Q1
2013: Q4Q3Q2Q1
2012: Q4Q3Q2Q1
2011: Q4Q3Q2Q1
2010: Q4Q3Q2Q1
2009: Q4Q3Q2Q1
2008: Q4Q3Q2Q1
2007: Q4Q3Q2Q1
2006: Q4Q3Q2Q1
2005: Q4Q3Q2Q1
2004: Q4Q3Q2Q1
2003: Q4Q3Q2Q1
2002: Q4Q3Q2Q1
 Subscribe via RSS:
Add to My Yahoo!
follow us in feedly

©All rights reserved to InvestmentWires, Inc. 1997-2020
14 Wall Street | 20th Floor | New York, NY 10005 | P: 212-331-8968 | F: 212-331-8998
Privacy Policy :: Terms of Use