Janus Capital Group’s alliance with Japan’s third largest life insurer should expand its presence in Asia and add more stability to its volatile shares.
But it remains to be seen if , can staunch the flow of investor dollars leaving the Denver money management firm.
Over the next 12 months, , has agreed to buy at least 15 percent and up to 20 percent of the Denver money management firm’s common shares.
It will also invest $2 billion in Janus, including $300 million up front into Janus mutual funds and accounts and $120 million via seed capital to develop new product offerings.
Once Dai-ichi Life owns 15 percent of Janus, it will gain a new seat on the company’s board of directors and will make the remaining investment, primarily into Janus’ fixed income funds.
Janus chief executive Richard Weil pursued the Dai-ichi Life alliance as part of his larger strategy of expanding the firm’s global footprint, said spokeswoman Jane Ingalls.
“We are aligning ourselves with a company that is large and has been around a long time,” she said.
International investors represent about 9 percent of the group’s total assets under management, leaving room for growth.
Janus manages money for that oversees about $124 billion for investors.
“Janus is a powerful franchise in the largest asset management market in the world,” said Hideto Masaki, a deputy president at Dai-ichi Life in a statement.
Investors reacted positively, driving Janus’ share price up 10 percent Friday. But most analysts following the company maintained hold or neutral ratings.
“They are still dealing with sizable redemptions and performance is an issue,” Michael Kim, an analyst with Sandler O’Neill & Partners LP in New York, told Bloomberg.
Janus, which built its brand on growth stock funds, .
Back in 2000, Janus managed more than $300 billion in assets, but only had $152.4 billion as of June 30.
Despite expanding into value, quantitative and fixed income offerings, Janus has lost ground to rivals. And the meager returns in stocks haven’t helped. Investors have pulled money out for 12 consecutive quarters.
Back in 2009, former Janus CEO Gary Black sought a buyer, and landed an offer from Franklin Templeton at more than $13 a share, above Friday’s close of $8.46 a share.
But the board of directors rejected it in favor of pursuing an independent path. And while Janus will forsake some independence with Friday’s deal, it will continue to do so on its own terms.
Aldo Svaldi: 303-954-1410, asvaldi@denverpost.com or twitter.com/aldosvaldi
