Dsp Merrill Plans To Hike Amc Pie
DSP Merrill Lynch Ltd (DSPML) today announced that it intends to increase its stake in its asset management subsidiary, DSP Merrill Lynch Investment Managers Ltd (DSP MLIM), from 60 per cent to just under 100 per cent. The move, subject to regulatory approvals, is aimed at simplifying DSP Merrill's management structure and investments in India.
DSPML had recently bought out Merrill Lynch Investment Managers' 40 per cent stake in the AMC as part of Merrill Lynch's global restructuring to localise decision making.
Shitin Desai, vice-chairman of DSPML, said it was an iteration of the company's commitment to the asset management business in India. Incidentally, the pricing for the stake buyout is yet to be decided. "We will be appointing valuers soon," said Desai.
Desai made it clear that Merrill Lynch was not exiting India but merely moving out of the asset management company. Merrill Lynch will continue to have a stake in DSP MLIM through its 40 per cent stake in the DSP ML joint venture. "There will be no change in their commitment to their operations in the country," he said.
This restructuring streamlines ownership at DSP MLIM for effective transfer of administrative function to the local management team, the company said in a release. This will allow DSP ML's management to respond quickly to the local business environment and carry out growth initiatives. Merrill Lynch will continue to be involved with the asset management company through its representatives on the bBoard of the asset management company.
Check Low, chairman of Merrill Lynch Asia Pacific and a director-to-be on the Board of DSP MLIM, said, "We are strongly committed to India and the DSP ML joint venture model has been very successful for both partners. By aligning DSP MLIM's ownership structure with that of our other businesses in India, we hope to achieve even greater success in the attractive long term fund management business."
Hemendra Kothari, DSP ML chairman said, "We appreciate the confidence that Merrill Lynch has in the local management team, which has indeed helped to create a leading domestic investment bank with all the benefits of a global organisation." He added, "With this move we expect to initiate a fresh focus in funds management in India, while running the business in line with global Merrill Lynch structures, practices and vision."
DSP ML holds 40 per cent in DSP ML through its subsidiaries. DSPMLIM manages assets of around Rs 2000 crore. Earlier in April, DSP ML had announced its plans to delist itself from the stock exchanges.
Merrill Lynch is one of the world's leading financial management and advisory companies, with offices in 37 countries and total client assets of about $1.4 trillion.