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 |
|
Monday, May 24, 2004 Price for Strong Still Falling Strong may have settled with regulators, but he may not be getting a better price for his fund firm. Bloomberg reported Monday morning that Wells Fargo probably will pay as little as $400 million to acquire Strong Capital. That amount is about 20 percent less than the rumored price of just a month ago and 60 percent below an offer Strong reportedly had in hand in 1999. The discount reflects the cloud surrounding the firm in the wake of disclosures that it had cut market timing deals with Canary Capital Partners and that Richard Strong himself had made market timing trades in the firm's funds. Both Richard Strong and Strong Capital settled the allegations with investigators last Thursday. Strong Capital reported that roughly $33.8 billion of assets under management at the end of April compared to about $75 billion at Wells Fargo. Separately, the Milwaukee Journal-Sentinel reported Monday that if Wells Fargo does purchase Strong Capital it may keep more than 700 of the nearly 1,100 jobs now located in Strong's Menomonee Falls headquarters campus. That report is based on an unnamed source. One appeal of the location is that Strong has call centers and retail offices set up to handle direct sales, while Wells Fargo is entirely reliant on sales through advisors, says the paper. For that reason the client services, operations and sales and marketing positions at Strong do not duplicate posts at Wells Fargo. Less clear is whether Wells Fargo has an interest in retaining the staff of investment professionals now at Strong. Printed from: MFWire.com/story.asp?s=7249 Copyright 2004, InvestmentWires, Inc. All Rights Reserved |