Dec. 30, 2002 — Fidelity Investments is taking over management of six index mutual funds that are currently run for the company by a unit of Deutsche Bank AG.
The switch will reduce the price Northern Trust (NTRS) will pay to acquire Deutsche Bank’s index-based asset management business, but will not scuttle the planned transaction, a spokeswoman for Northern said. Northern announced in September that it agreed to acquire the business for about $260 million.
Fidelity will take over the stock index funds, which the company said have about $25.5 billion in assets, on Jan. 13. The company believes it can provide shareholders in the funds with “consistent management in a cost-effective manner” by bringing management of the offerings in-house, said Fidelity spokesman Vin Loporchio. He added that the funds’ expense ratios will not change.
Fidelity has “no particular issues” with Northern or the service it has received from Deutsche Asset Management Inc., Loporchio said. Northern’s planned acquisition led Fidelity to review its management agreement with Deutsche, he said.