Columbia Management hired Deutsche Asset Management to subadvise six collateralized loan obligation strategies, according to a news release. DeAM will now manage roughly the $2 billion in CLO assets that have been managed by Columbia and its Flagship Capital Management affiliate.
As part of the agreement, members of Columbia's CLO investment team will move to DeAM, said Bart Grenier, managing director and global head of fixed income at DeAM. Ten of Columbia's investment professionals will be joining DeAM before the end of the first quarter, Mr. Grenier said. Adding the CLO team will round out the firm's asset-backed securities and collateralized debt obligation offerings in the United States, he said, adding that DeAM is evaluating opportunities to add CLO capabilities to its offerings in Europe as well.
Tom Gariepy, Columbia spokesperson, confirmed that Columbia is now effectively moving out of the CLO business. Columbia officials decided the strategies were not part of the firm's "core competencies" and did not present the same growth opportunities as other fixed-income strategies, he said. Mr. Gariepy declined to say whether other CLO investment professionals will remain at Columbia or identify any of the team members that are leaving the firm.