Pioneer Management is negotiating to buy out its Indian partners in the Chennai-based Kothari Pioneer AMC.
Pioneer and Kothari each hold 47.5% in the $2.5 million equity of the company. Other domestic financial institutions own the balance of the stock.
Vivek Reddy, CEO of Kothari Pioneer, confirmed the two parties have had discussions on the issue but added these are only preliminary talks.
Sources in Kothari Pioneer said the two partners have had good relations; Pioneer officials would like to boost their stake given the joint ventures strong performance in managing technology stocks. The Infotech Fund launched by Kothari Pioneer last August has returned more than 120% since inception. Another fund, Kothari Blue Chip, returned 26.6% during the same time period.
In addition, the Indian government has proposed granting tax benefits to equity mutual funds.