Liberty Financial Cos. plans to rebrand several of its mutual fund families under the Liberty name and is exploring acquisitions to expand its fund business, an executive with the company said.
The branding switch, set to take effect in late spring, will affect funds from Stein Roe & Farnham Inc., Colonial Management Associates Inc., Newport Fund Management, and Crabbe Huson Group, said Stephen C. Gibson, chief executive of Liberty Funds Group, which provides sales and marketing for those fund families.
Colonial, the group's biggest seller of funds through banks, sold about $631 million through that channel in 1999.
The Stein Roe Growth Fund, for example, will become the Liberty Growth Fund. The Crabbe Huson name will be dropped, but all funds will have "contrarian" in their name. "Contrarian" reflects Crabbe Huson's well-known management style of buying out-of-favor stocks and bonds.
The Newport Funds will be renamed Liberty-Newport in order to promote the Liberty name and at the same time retain Newport's international investing renown, Mr. Gibson said.
Liberty - which Lipper Inc. ranks 38th among the mutual fund managers, with $25.78 billion under management on Dec. 31 - is among several fund companies looking into acquisitions to make it into the top 10, according to Mr. Gibson.
"We are absolutely are going to make an acquisition to do that," he said.
Specifically, Liberty would be interested in a small-cap growth management company or one with an international focus. Mr. Gibson said Liberty sees growth overseas as the next big trend and that it has already begun to beef up its international capabilities by moving the management of about $1 billion of assets to Newport from Colonial and Stein Roe.
Mr. Gibson declined to name possible acquisition targets.
Liberty is up against much larger fund companies as it vies for assets in what is widely believed to be a mature industry. Fund flows into the $6.8 trillion fund industry have slowed in recent months, and companies are battling for contracting shelf space. The biggest companies are taking in the bulk of the money, leaving smaller players like Liberty scrambling.
According to Mr. Gibson, Liberty's expansion efforts have been hindered by investors' pronounced preference for growth funds - particularly those laden with technology stocks - at the expense of other styles.
"To really move up, we think we need the rotational environment," he said.
Gaining ground will be a difficult task for Liberty, even with an increased focus on a central brand, said Geoffrey Bobroff, a mutual fund consultant in East Greenwich, R.I.
He said Liberty lacks a strong name in the asset management world and that it will take time to get that recognition. The company will also have to show investors that it is the place to go for any asset class, be it growth, fixed income, contrarian, or international.
"They want to be viewed as a multimanager home where you can pick and choose," Mr. Bobroff said.
