Federated Acquiring PNC's MMFs
A press release entitled, "Federated Investors, Inc. to Acquire Certain Investment-Management-Related Assets from The PNC Financial Services Group," tells us, "Federated Investors, Inc. (FII) and The PNC Financial Services Group (PNC) today announced that they have reached a definitive agreement for Federated to acquire certain components of PNC Capital Advisors LLC's (PCA) investment-management business. The proposed transaction includes the reorganization of PNC's family of liquidity, equity and fixed-income mutual funds into corresponding Federated mutual funds, the acquisition of a portion of PNC's separate account and separately managed account business, and the transition of a six-person international equity management team from PNC to Federated.... Through the agreement, approximately $9 billion in assets from three PNC government and treasury money market funds is expected to be transitioned through mutual fund reorganizations.... The existing Federated mutual funds have comparable investment strategies." It continues, "Post-closing, PCA will manage approximately $21 billion of custom liquidity and fixed-income solutions to address the needs of PNC's corporate and institutional clients, including corporations, healthcare organizations, insurance companies, unions, higher education, government entities and endowment, and foundations. The employees of PNC's liquidity and taxable fixed-income teams will remain with PCA, focused on managing separate accounts." Federated President & CEO J. Christopher Donahue comments, "We are pleased to be working with PNC on this transaction. Federated is committed to helping PNC’s clients reach their financial goals by providing solid product performance, a range of compelling investment solutions and superior client service." The release adds, "The transaction is expected to close in the fourth quarter of 2019. Federated will pay PNC an estimated total purchase price of $52 million when the transaction is completed. The transaction has been approved by the Board of Directors of Federated Investors, Inc. The Federated Mutual Fund Board of Trustees and the PNC Funds Board of Trustees will be asked to consider the mutual fund reorganizations in the coming months." The Liquidity Product transitions include: PNC Government Money Market Fund ($13.0B) will merge into Federated Government Obligations Fund, PNC Treasury Money Market Fund ($1.8B) will merge into Federated U.S. Treasury Cash Reserves Fund, and PNC Treasury Plus Money Market Fund ($424M) will merge into Federated Treasury Obligations Fund.
