Fthr re US Strategy Formation
Old Mutual PLC
8 January 2001
OLD MUTUAL PLC
Old Mutual Announces Further Phase in its US Strategy
Formation of Old Mutual Asset Managers (US)
Following its acquisition of United Asset Management
Corporation ('UAM') in the US, completed in September last
year, Old Mutual has embarked on a further phase in the
development of its US businesses.
Recently, the company announced the acquisition of
additional revenue streams from Pilgrim Baxter, its major US
mutual funds franchise and retail distribution platform.
Today's announcement relates to the formation, subject to
regulatory approval, of an aligned group of affiliates to be
called Old Mutual Asset Managers (US) ('OMAM(US)').
The aligned affiliates, representing total assets under
management of $70 billion as at 30th November 2000 and
aggregate earnings before interest, taxes, depreciation and
amortisation of $81 million (run-rate as at 30th November
2000), began operating as part of the OMAM(US) division as
from 1 January 2001. The combined revenue is $206 million
(run-rate as at 30th November 2000).
The formation of OMAM(US) creates a substantial, multi-
style, multi-product asset management business in the US.
It comprises the following six firms: Analytic Investors,
Barrow, Hanley, Mewhinney & Strauss, Inc., Clay Finlay Inc.,
Dwight Asset Management Company, NWQ Investment Management
Company and Provident Investment Counsel. (Further details
of these firms are attached). The affiliates that have
agreed to become part of OMAM(US) cover a broad spectrum of
complementary, non-overlapping asset classes and investment
styles, and collectively represent a wide range of
investment capabilities. In choosing to align themselves
with OMAM(US), the firms have agreed to modify their
economic relationship with Old Mutual from a revenue-sharing
to a profit-sharing basis. Over time a number of other UAM
affiliates may also join OMAM(US).
Each affiliate that has agreed to join OMAM(US) will retain
its own identity, brand, investment philosophy and
investment process, as well as responsibility for its client
relationships. The firms will seek opportunities to work
together co-operatively for the benefit of their clients and
staff. They will also provide comprehensive coverage of US
asset markets and broad-based global product offerings to
existing Old Mutual Group clients in Africa and Europe.
OMAM(US) will work closely with all of Old Mutual's
international asset management businesses, in particular
with OMAM(UK) and OMAM(South Africa) and with Pilgrim
Baxter.
Kevin Carter of Old Mutual will be Chief Executive Officer
of OMAM(US). Carter will head a small team of high level
executives, based in Boston and London, which will be
responsible for executing strategy for OMAM(US). The team
will also act as business consultants to the affiliates,
helping them to grow their businesses, both individually and
collectively.
Brian Malone (as Finance Director) and Brian Baskir of Old
Mutual will join Kevin Carter on the board of OMAM(US),
which will also include Richard Robie and George McClelland
from UAM. Representative CEOs from the OMAM(US) aligned
affiliates will also serve on that board. Eric Anstee,
Chief Executive Financial Services, of Old Mutual plc, will
be Chairman.
Kevin Carter commented:
'With the creation of OMAM(US), we are able to offer a range
of exceptional international investment capabilities both in
the US and to our customer base in Europe and southern
Africa, and grow these substantially over time. Significant
new revenue synergies are obtainable through active
cooperation between the affiliates within OMAM(US). The
affiliates are world-class in terms of their investment
processes and teams of investment professionals, and have an
exciting and diverse range of products, with outstanding
performance track records.'
Other UAM affiliates, apart from Pilgrim Baxter, will remain
with UAM's current management, led by Jim Orr, Chief
Executive Officer. In addition to Jim Orr, the management
team at UAM includes Frank Kettle, Joe Ramrath, Kevin
O'Brien and Stuart Nagode, all of whom have entered into new
three year employment agreements with UAM. Old Mutual
expects to continue to hold a number of affiliates on a
completely stand-alone basis. It also expects that some UAM
affiliates may join OMAM(US) over time. All discussions
with these affiliates about their future strategy will take
place collaboratively, with the objective of aligning the
interests of each firm's clients, their investment
professionals and Old Mutual as the shareholder. Old Mutual
has stressed that there will be no mass sale or forced
consolidation of firms.
The acquisition and development of UAM is consistent with
Old Mutual's strategic goal of building a world-class global
asset management business. Eric Anstee, Chief Executive,
Financial Services, said:
'We have now gained a strong foothold in the critical US
market on a basis which we are confident will significantly
enhance shareholder value over the years ahead. The
acquisition of UAM has provided us with a wide range of
exceptional asset management operations serving a broad
community of investors. The creation of OMAM(US), combined
with our UK and South African operations, gives us a
significant international platform in asset management.'
8 January 2001
Further Enquiries:
Old Mutual plc (UK)
James Poole +44 (0)20 7569 0121
Anna Quenby +44 (0)20 7569 0133
Old Mutual plc (SA)
Paul Dold +27 21 509 9111
College Hill Associates (UK)
Gareth David +44 (0)20 7457 2020
Nicholas Williams +44 (0)20 7457 2020
United States
Kevin Carter +1 617 330 8662
Tucker Hewes +1 212 207 9451
NOTES TO EDITORS
Analytic Investors
Analytic Investors is an investment management company
widely recognised for its commitment to innovative
investment research, a disciplined quantitative management
approach and its ability to implement sophisticated trading
and portfolio management strategies. Analytic's investment
philosophy is founded on the premise that the systematic
application of quantitative techniques has the potential to
deliver superior risk-adjusted performance, regardless of
market cycle. With vast amounts of information available on
demand, the company believes that the proper weighting of
the right variables in the selection process is pivotal to
their success. Based in Los Angeles, California, Analytic
manages some $1.7 billion on behalf of institutional
investors and individuals through its highly rated mutual
funds.
Chairman: Roger G. Clarke, Ph.D.
President/Portfolio Mgr: Harindra de Silva, Ph.D., CFA
CIO/Portfolio Mgr.: Gregory M. McMurran
COO: Marie Nastasi Arlt
Barrow, Hanley, Mewhinney & Strauss, Inc.
Barrow, Hanley, Mewhinney and Strauss, founded in 1979, is
one of the largest value-orientated investment managers of
institutional assets in the US and has demonstrated a long-
standing commitment to this investment style. With some $26
billion under management, the company's 21 investment
professionals, with an average experience in excess of 23
years, manage domestic equity and fixed income portfolios
for a variety of institutional clients. BHM&S is located in
Dallas, Texas.
Principal, Large Cap Value Equity Portfolio Manager: James P. Barrow
Principal, Large Cap Value Equity Portfolio Manager: Ray Nixon, Jr.
Principal, Large Cap Value Equity Portfolio Manager: Richard A. Englander, CFA
Principal, Large Cap Value Equity Portfolio Manager: Robert J. Chambers, CFA
Principal, Large Cap Value Equity Portfolio Manager: Timothy J. Culler, CFA
Principal, Large Cap Value Equity Portfolio Manager: Jane Gilday, CFA
Principal, Fixed Income Portfolio Manager: John S. Williams,CFA
Principal, Director of Marketing: Robert D. Barkley
Principal, Senior Equity Analyst: H. Monroe Helm, III
Clay Finlay Inc.
Clay Finlay Inc. is a New York based, global equity
management firm with offices in London, Geneva, Melbourne
and Tokyo managing approximately $5 billion. Clay Finlay's
highly experienced investment professionals work as a team
to manage concentrated, yet risk-controlled, global and
regional equity portfolios on behalf of clients located
worldwide. Clay Finlay's investment approach is growth
oriented and is driven primarily by a disciplined, price-
sensitive stock selection process.
Francis Finlay, CFA - Chairman and CEO
John Clay - Chairman Emeritus
Arthur Barton - Director
Frances Dakers - Director
Greg Jones, CFA - Director
Susan Kenneally - Director
Peter Lyon - Director
Virginie Maisonneuve, CFA - Director
Robert Schletter, CFA - Director
Dwight Asset Management Company
Dwight Asset Management Company has focused on the
management of stable value portfolios for defined
contribution plans. The primary investment objective is
capital preservation. Secondary objectives include
competitive yield, investment diversification and real
return over a market cycle. The objectives are met through
rigorous risk management, credit research and duration
management. Dwight offers a variety of portfolio allocation
strategies tailored around the core philosophy of capital
preservation. Their disciplined investment and credit
research has historically allowed Dwight to achieve superior
returns with low volatility and high credit quality. Dwight
has also developed an excellent fixed income capability,
recently augmented by the addition of the Dewey Square fixed
income business and three of the senior investment
professionals previously with Dewey Square. Dwight manages
some $14 billion on behalf of its institutional clients and
is located in Burlington, Vermont.
President: John K. Dwight
Managing Director, Portfolio Manager: Laura P. Dagan, CFA
Managing Director, Portfolio Manager: David W. Richardson,
CFA
NWQ Investment Management Company
NWQ Investment Management Company, founded in 1982, utilizes
a value oriented style in managing a broad array of
portfolio strategies including large, mid and small cap
equity, balanced and fixed income. Clients include public
entities, foundations, endowments, corporate and multi-
employer plans as well as high net-worth individuals. The
company is based in Los Angeles, California and manages over
$5 billion in assets.
NWQ's thirteen member team of investment professionals
average 21 years of experience and 9 years tenure. Drawing
on a single underlying value-oriented philosophy, NWQ's
opportunistic valuation framework is designed to select
securities with favorable risk-reward characteristics. The
firm's hallmark continues to be the ability to uncover
companies and industries where positive change is about to
occur, through a research-intensive bottom-up stock
selection process.
Chairman, CIO: David A. Polak, CFA
President & CEO: Michael Mendez
Managing Director: E.C. (Ted) Friedel, CFA
Managing Director: Jon D. Bosse, CFA
Provident Investment Counsel
Provident Investment Counsel manages accounts for
institutional clients according to a growth equity
investment style, emphasizing fundamental research and a
team approach to portfolio management. The research staff
at Provident seek out companies with strong financial
characteristics, which are thought to be in a period of
high, sustainable earnings growth. Over the long run,
Provident's investment success has been a function of their
commitment to their investment style. Based in Pasadena,
California, the company has $17 billion in Institutional,
Mutual Fund, and brokerage sponsored program assets across
the spectrum of growth strategies as well as Balanced and
Fixed Income strategies.
Chairman/PM
Robert Kommerstad
Executive Managing Director/CEO/PM
Larry D. Tashjian CFA,CIC
Executive Managing Director/PM
George E. Handtmann III, CFA, CIC
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