Richard Driehaus is going ahead with merging three of his shop's funds out of existence despite a recent turnaround in performance. Yet his decision to merge the funds is not proving popular with the funds' portfolio managers, Reuters reports. Driehaus is merging the funds because they have been unable to attract sufficient investors. All together, the five mutual funds hold just $200 million of the $2.5 billion in assets Driehaus manages.

"Our numbers are very good, but it's been hard to gather assets," Driehaus told Reuters. Driehaus European Opportunity, for example, has gained more than 28 percent in 2003, compared with an 11 percent gain for the average international stock fund tracked by Morningstar.

The plan is to merge the Driehaus European Opportunity, the Driehaus International Growth and European Opportunity funds into the International Discovery fund in September. At the same time the Asia Pacific Growth fund will be folded into the Emerging Markets Growth fund.

"I'm a happy investor in these funds myself," Robert Moyer, president of Chicago-based Driehaus Capital Management, told Reuters. "The issue is if at the end of the day you only have $40 million or so (in one fund) and it's costing you money every year to support this ... it's really not very sensible to do."  

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