MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication
an InvestmentWires' Publication
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MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication |
|
Tuesday, March 27, 2012 Transamerica is a Big Loss for Morningstar Transamerica's decision to drop Morningstar as the advisor to its variable annuity and fund-of-funds products has the attention of Joe Mansueto. The Morningstar founder and CEO typed a memo to Morningstar's workers admitting that losing the contract is a "setback" but that it will not lead to job cuts. That memo ended up in the hands of reporters at Crain's Chicago Business. Transamerica Asset Management is ending the contract, which paid Morningstar $12 million annually (two percent of its topline), after hiring Tim Galbraith, a Morningstar executive who ran its account. The Transamerica relationship was Morningstar's largest asset management account. Transamerica continues to purchase other products from Morningstar. Galbraith's abandoned post of director of alternative strategies is not being filled. "Although this is a meaningful loss for us, Morningstar is a strong and profitable company with a diversified revenue stream," wrote Mansueto in the February 28 memo. "It's always tough to lose business from a longstanding client, but we're well positioned to weather this setback." Crains reported that Mansueto also wrote that Morningstar will "need to continue to carefully manage our discretionary expenses such as travel and marketing and more closely examine planned new hires and replacement positions in light of this news." Morningstar's investment management division saw revenues grow 18 percent last year. Printed from: MFWire.com/story.asp?s=39569 Copyright 2012, InvestmentWires, Inc. All Rights Reserved |