April 20, 2012
AMG Buys Yacktman Funds
Boston-based Affiliated Managers Group has agreed to acquire a majority equity interest in Yacktman Asset Management Co.
As part of the deal, all of Yacktman's senior professionals have agreed to long-term commitments with the firm. In addition, the Yacktman funds will become part of the Managers family of funds. The terms of the transaction were not disclosed.
After the closing of the deal, the father and son team of Donald Yacktman, founder, Stephen Yacktman, and the rest of the management team will continue to hold a "substantial portion of the equity of the business and direct its day-to-day operations," according to a release.
Goldman, Sachs & Co. served as financial advisor to Yacktman, while Fried, Frank, Harris, Shriver & Jacobson LLP served as legal counsel.
"Our partnership with AMG enables us to address long-term succession planning needs through an equity incentive program which provides liquidity to the current partners and to future generations, fosters stability within the organization, and, most importantly, offers significant support to continue the business momentum we have established," stated Donald Yacktman.
Yacktman currently manages some $17 billion in assets in large-cap equities products. AMG managed some $352 billion as of December 31, 2011.
Reynolds, Booth Take Home Executive Honors
Two mutual fund heavyweights have been recognized for their focus on consumer needs, innovation and fiduciary services.
Tiburon Strategic Advisors' managing partner Chip Roame last week awarded the fifth annual Tiburon CEO Summit Awards to David Booth, chief executive at Dimensional Fund Advisors, and Bob Reynolds, chief executive at Putnam Investments, at the Tiburon CEO Summit XXII in New York City.
Booth accepted the award and said that his firm was based on more transparency, lower fees and lowering conflicts of interest between its advisor clients and the end investors.
"There's nothing wrong with commission but are people getting commissions for selling bad stuff?" he asked an audience of other fund executives and advisors.
For his part, Reynolds advises other mutual fund purveyors to "Put yourself in your clients' shoes and ask what would you do/want?"
Putnam Preps Active ETF
The nascent active exchange-traded fund space, which is currently populated by PIMCO, AdvisorShares and Guggenheim, will soon get a new entrant if it has anything to say about it.
Boston-based Putnam Investments is exploring active ETFs as another revenue stream, according to CEO Bob Reynolds.
Reynolds, who shared his firm's plans at the Tiburon CEO Summit XXII in NYC last week, said: "I do think there will always be room for active management and the more people who index, the more inefficient the market becomes. ETFs are great trading vehicles but some of them underperform their benchmarks by 1000 basis points."
He added that "skill always gets paid," referring to active managers versus their indexing counterparts (See, "Putnam's Reynolds Likes on ETFs, Rollovers," p.1).