The Hindu : Sundaram Finance to acquire Newton's stake in MF JV

Online edition of India's National Newspaper
Tuesday, Jun 25, 2002

Business

Business

Sundaram Finance to acquire Newton's stake in MF JV

MUMBAI JUNE 24. The Chennai-based Sundaram Finance is planning to acquire 39 per cent stake owned by the U.K.-based Newton Investment Management in their mutual fund joint venture entity.

``We are in the process of identifying a consultant for the valuation of Newton's stake in Sundaram Newton Asset Management Company and expect to complete the buy-out in four to six weeks'', Sundaram Mutual managing director T. P. Raman told newspersons after introducing three funds and a new corporate entity here today.

SFC currently owns 61 per cent and after the acquisition the mutual fund entity would become its wholly-owned subsidiary, he said. The global acquisition of Newton by the U.S. based Mellon Financial Corp led to this decision of buying out the JV partner's stake, Raman said.

On plans to scout for another partner for the mutual fund entity, the MD said ``we are open for alliances in the future''.

Referring to the new open-ended products, Sundaram Mutual vice president, marketing and sales, Sanjay Santhanam said `Select Focus' and `Select Midcap' were equity oriented while `Income Plus' was for debt.

The initial public offering (IPO) would open from today and close on July 19, he said.

Mr. Santhanam said the `Select Focus' would at most times comprise 15 stocks (minimum 10 and maximum 20) while `Select Midcap' would focus on mid-cap stocks that were capable of providing superior returns over the medium term.

Both these funds would be available at Rs. 10 per unit during the IPO with no entry ad exit loads, he said.

`Income Plus' would invest predominantly in `AA' rated securities and government securities. The fund would levy an exit load of 1.5 per cent for redemptions within six months of investment, he said.

The minimum application amount for these funds was Rs. 5,000 and multiples of Rs. 500 thereafter, Santhanam added.

Sundaram Mutual's assets under management stood at Rs. 750 crores as on June 21. — PTI

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