Edelweiss to buy JP Morgan Mutual Fund business

JP Morgan becomes the seventh foreign company to exit the mutual fund business in India

Samar Srivastava
Published: Mar 22, 2016 05:54:18 PM IST
Updated: Mar 22, 2016 06:32:09 PM IST

After studying law I vectored towards journalism by accident and it's the only job I've done since. It's a job that has taken me on a private jet to Jaisalmer - where I wrote India's first feature on fractional ownership of business jets - to the badlands of west UP where India's sugar economy is inextricably now tied to politics. I'm a big fan of new business models and crafty entrepreneurs. Fortunately for me, there are plenty of those in Asia at the moment.

Edelweiss to buy JP Morgan Mutual Fund business
Image: Reinhard Krause / Reuters
Edelweiss plans to retain the majority of JP Morgan’s employees including the management team

Edelweiss Asset Management Ltd, on Tuesday announced the acquisition of the mutual fund business of JP Morgan Asset Management India Pvt Ltd. The company did not disclose the size of the deal, which is subject to regulatory clearances.
 
With this deal, JP Morgan becomes the seventh foreign company to exit from the mutual fund business in India. At Rs 7081 crore, its assets under management are worth more than five times those of Edelweiss. On 4 March, The Economic Times had reported that Tata Asset Management was in talks to buy the domestic mutual fund business of JP Morgan.
 
In a similar deal last year, DHFL Pramerica Asset Managers had bought out Deutsche Asset Management India's mutual fund business. Last October, Goldman Sachs sold its India mutual fund business to Reliance Mutual Fund.
 
Last August, JP Morgan had to restrict redemptions in two schemes that had securities of the Amtek Auto Ltd. The company defaulted on bond payments, which led to redemption pressure on the two schemes. The fund eventually sold the Amtek bonds to repay investors.
 
Edelweiss has said it plans to retain the majority of JP Morgan’s employees including the management team. “In addition to its leading role in the financial services industry in India, one of the reasons why we selected Edelweiss as the preferred acquirer was its commitment to continue to drive the best outcome for our clients,” said Nandkumar Surti, managing director and chief executive officer JP Morgan Asset Management India Pvt Ltd.

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  • Roshan Singh

    Good move edelweiss

    on Mar 24, 2016
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