Manning & Napier Inc. has faced serious hardships of late due to poor performance, high turnover and the broader migration of institutional assets to passive management.
The Fairport, N.Y.-based money manager has been plagued with outflows for years. Data from Pensions & Investments show that Manning & Napier had $27.1 billion in assets under management as of June 30, down 24% from the same time a year ago and down nearly 50% from its peak AUM of $54.1 billion three years earlier. Quarterly earnings statements show that the fourth quarter of 2012 was last time the firm saw net inflows (client flows were flat in 2013's first quarter).
The firm has also recently lost several senior people — including its CEO. Its stock price has been in decline, dropping to $3.85 at the market close on Sept. 27, down more than 80% from its peak of $19.89 on May 27, 2013.
"It's a perfect storm," said one competitor who asked not to be identified. "Being active, having bad performance, and facing public scrutiny for being a public entity doesn't help them."
Jeffrey S. Coons, Manning & Napier's president, said the firm, which primarily offers active traditional long-only investment strategies, has restructured its investment teams and is refocusing its efforts on risk management and total asset allocation — which he believes should reverse the company's flows and fortunes.
"We have a strong balance sheet," said Mr. Coons in a Sept. 25 interview. "Financially, we are not challenged as a firm."
Mr. Coons added that, despite reorganizing the investment teams, the company hasn't "changed anything about who we are or what we do or how we serve our clients."
"It's the same firm, the same investment process," he said.
Recent client terminations include:
New York State Deferred Compensation Plan, Albany, voted in August to terminate Manning & Napier as manager of an $83 million international equity growth portfolio for the $21.8 billion plan, citing performance;
Wyoming State Loan and Investment Board, Cheyenne, voted in August to drop the firm from its $228 million active international equity portfolio as part of the $20.2 billion board's effort to reduce fees and increase risk-adjusted returns; and
Ohio State Highway Patrol Retirement System, Columbus, in April 2016 terminated the firm as manager of $32 million during a review of the $849 million retirement system's international equity portfolio.