Federated Investors reached agreement to acquire seven retail mutual funds with $600 million in assets from The William Penn Co. Terms were not disclosed. The deal is expected to close during the second quarter.
The Penn Square Mutual, Scottish Widows International, William Penn Pennsylvania Tax Free, William Penn New York Tax Free Income, William Penn Quality Income, William Penn U.S. Government Securities Income and William Penn Money Market Income Funds will be merged into their equivalent Federated funds, pending shareholder approval.
Bankers Trust Co.'s global investment management unit stemmed the flow of red ink that had afflicted it for the last two years.
In its annual report, the company reported $13 million in net income and revenue of $300 million for its investment management operations in 1996, compared with a loss of $10 million and $265 million of revenue in 1995 and a $30 million loss on revenue of $247 million in 1994.
Total investment management assets rose to $201 billion in 1996 from $175 billion the previous year, with 65% of new assets coming from existing clients. The report credits most growth on strong sales of index and specialty money management products. Index products alone made up $110 billion of total assets and $10 billion of the new assets acquired in 1996.
Dun & Bradstreet will report tomorrow that U.S. executives expect economic growth in the second quarter to be the strongest in more than two years. D&B's survey of 3,000 business executives found robust growth is expected throughout the economy, as nearly every industry tracked forecast increased sales and profits through the end of June. Executives said they expect prices and employment levels to rise more quickly during the period. Among all firms surveyed, 69% expect net sales to increase during the period vs. 64% in the prior survey. Sixty-two percent expect higher net profits, compared with 56% in the first quarter. The number of firms expecting to increase selling prices rose to 41% of all companies surveyed, up from 37%.
American Express Institutional Services added 11 non-proprietary mutual funds to its SmartPartners alliance for full-service bundled defined contribution clients. Bob Richey, senior vice president of investments, said the alliance now has 21 outside fund offerings and 18 American Express funds. The 11 funds from 13 families are a ``best in class'' group of top-performing, top-quartile funds.
L. Roy Papp Associates introduced its third mutual fund, the America-Pacific Rim Fund. The no-load fund will invest in U.S. stocks with substantial sales and income from Pacific Rim countries. The concept is similar to that of the Papp America-Abroad Fund.