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Invesco To Buy Oppenheimer Funds, Adding $246 Billion In Assets
Invesco Ltd. agreed to buy OppenheimerFunds from Massachusetts Mutual Life Insurance Co., adding more actively managed products to the lineup at one of the largest managers of exchange-traded funds.
Ouch - That one affects me. About 10% in Oppenheimer going back 25 years. A flawed outfit for sure, but I use (and like) some of their more exotic specialty finds for certain portfolio needs. My other houses steer clear, for the most part, of these niche funds. Currently I hold through Oppenheimer: a gold fund, an infrastructure fund, and a pretty good Alternatives fund. The last has had a rocky past, but current manager Michelle Borre, has done a nice job with it.
How good a manager is Invesco? Have they proven themselves ethical? Committed to shareholders? Reasonable re fees? Easy to deal with? One nice thing about Oppenheimer has been very low minimums. This allows you to scale into a new fund gradually or spread out a relatively small stake among several different funds. From an operating cost perspective, I’d suspect Invesco will look to increasing those minimums.
Is this likely to produce turnover among fund managers?
Here’s the AUM for each of my 3 funds as Lipper lists them. I’m surprised the infrastructure fund (recently acquired from Macguarie) has such a small amount.
OQGAX (global infrastructure) 23.86 M
OPGSX (gold/pm) 856.4 M
QVOPX (alternatives) 1.21 B
As one of the last standing “active management” types, I fear this news in itself will precipitate additional exodus out of Oppenheimer and in the direction of passive funds, making it even more expensive for Oppenheimer to manage their shrinking base and harder to retain talent.
Anybody here deal with Invesco? Thanks for any thoughts on how the buyout may affect existing investors.
Gradually, Invesco merged away some of its quirky funds (while expanding Powershare non-vanilla ETFs), and did away with brand names AIM, Powershares, and Guggenheim. https://www.invesco.com/pdf/IFPA-FLY-13-E.pdf (for example)
The only Invesco fund that caught my attention in recent years was LCEIX. Generally, the family seemed slightly pricey (though acceptable), with at best somewhat above average performance funds. Invesco was also involved in the 2003 market timing scandal. https://www.marketwatch.com/story/invesco-aim-settle-fund-trading-charges-for-450-mln
Again, this is not a family I've followed much. More like bits and pieces than a cohesive picture.
(from @msf’s link above) Atlanta, October 18, 2018 --- Invesco Ltd. (NYSE: IVZ) today announced a combination with OppenheimerFunds, a strategic partnership with Massachusetts Mutual Life Insurance Company (MassMutual) and a $1.2 billion common stock buyback program. Invesco also reported financial results for the three months ended September 30, 2018. “The combination with OppenheimerFunds and the strategic partnership with MassMutual will meaningfully enhance our ability to meet client needs, accelerate growth and strengthen our business over the long term,” said Martin L. Flanagan, President and CEO of Invesco. “This is a compelling, highly strategic and accretive transaction for Invesco ... “
Interesting. Invesco’s PR portrays this more as a merger (“alliance”). But with only a 15% stake by Mass Mutual in the new conglomerate, it certainly sounds more like the purchase or takeover the press is portraying it as.
The first link from @msf is quite interesting - a throwback to 1996. - And I didn’t even realize Invesco was based in London until I read the story.
One correction on my part - The very low AUM I cited for their infrastructure fund was for the Class A shares which I happen to own. More than likely the total AUM for that fund are much higher. Possibly the shareholders acquired in Oppenheimer’s purchase of the fund from Macguarie came in under a different share class.
Comments
How good a manager is Invesco? Have they proven themselves ethical? Committed to shareholders? Reasonable re fees? Easy to deal with? One nice thing about Oppenheimer has been very low minimums. This allows you to scale into a new fund gradually or spread out a relatively small stake among several different funds. From an operating cost perspective, I’d suspect Invesco will look to increasing those minimums.
Is this likely to produce turnover among fund managers?
Here’s the AUM for each of my 3 funds as Lipper lists them. I’m surprised the infrastructure fund (recently acquired from Macguarie) has such a small amount.
OQGAX (global infrastructure) 23.86 M
OPGSX (gold/pm) 856.4 M
QVOPX (alternatives) 1.21 B
As one of the last standing “active management” types, I fear this news in itself will precipitate additional exodus out of Oppenheimer and in the direction of passive funds, making it even more expensive for Oppenheimer to manage their shrinking base and harder to retain talent.
Anybody here deal with Invesco? Thanks for any thoughts on how the buyout may affect existing investors.
https://www.nytimes.com/1996/11/05/business/invesco-to-acquire-aim-for-1.6-billion.html
https://www.fa-mag.com/news/the--powershares--name-is-no-more-39023.html
My recollection is that at the time Invesco had some curious sector funds, such as Invesco Leisure, Invesco Utilities, etc., as well as Invesco Dynamics (mid cap growth). AIM was a load family, focused on momentum growth (think AIM Constellation). Like American Century at the time, Invesco decided to go the load route.
https://www.thestreet.com/story/10004594/1/no-load-no-way-says-invesco.html
Gradually, Invesco merged away some of its quirky funds (while expanding Powershare non-vanilla ETFs), and did away with brand names AIM, Powershares, and Guggenheim.
https://www.invesco.com/pdf/IFPA-FLY-13-E.pdf (for example)
The only Invesco fund that caught my attention in recent years was LCEIX. Generally, the family seemed slightly pricey (though acceptable), with at best somewhat above average performance funds. Invesco was also involved in the 2003 market timing scandal.
https://www.marketwatch.com/story/invesco-aim-settle-fund-trading-charges-for-450-mln
Again, this is not a family I've followed much. More like bits and pieces than a cohesive picture.
Interesting. Invesco’s PR portrays this more as a merger (“alliance”). But with only a 15% stake by Mass Mutual in the new conglomerate, it certainly sounds more like the purchase or takeover the press is portraying it as.
The first link from @msf is quite interesting - a throwback to 1996.
One correction on my part - The very low AUM I cited for their infrastructure fund was for the Class A shares which I happen to own. More than likely the total AUM for that fund are much higher. Possibly the shareholders acquired in Oppenheimer’s purchase of the fund from Macguarie came in under a different share class.