OppenheimerFunds' planned purchase of Trinity Investment Management Corp. would give it entree not only into institutional money management but also to new products for the 401(k) and other markets.
"What we need is Trinity's products," said Len Darling, chief executive of Harborview Asset Management, OppenheimerFunds' institutional arm.
OppenheimerFunds announced plans this month to buy Trinity for an undisclosed sum. Upon the deal's completion, which is expected in April, Trinity would be merged into Harborview.
Trinity, a Bellefonte, Pa., company, manages $8.2 billion for more than 100 institutional clients. OppenheimerFunds is basically a retail mutual fund company, with a tiny institutional component.
While New York-based OppenheimerFunds uses fundamental research to select investments, Trinity employs a number of quantitative factors.
That style is likely to appeal to 401(k) plan sponsors and very wealthy people who use wrap accounts, as well as to the consultants who advise them on selecting money managers. Among those consultants, Trinity is already well known and respected, said Burton Greenwald, a mutual fund consultant in Philadelphia.
Though OppenheimerFunds has had success in recent years selling mutual funds through brokerages, it has been conspicuously absent from institutional account management.
Companies like Putnam Investments, Franklin Templeton Group, and Capital Research and Management all have a much larger percentage of institutional business than OppenheimerFunds.
"Trinity provides them with entree into that area of the business," Mr. Greenwald said.
OppenheimerFunds has $95 billion of assets under management but just about $1 billion of institutional accounts-all of which it manages for its parent company, Massachusetts Mutual Life Insurance. It has about $2.4 billion of 401(k) assets.
Trinity's clients are primarily corporate and public retirement plans, as well as educational and charitable endowment funds.
Most of Trinity's principal executives have agreed to long-term contracts to stay with OppenheimerFunds. Mr. Darling could not immediately say how long the contracts are to run, but such arrangements typically call for a commitment of at least three years.
Asked how quickly he would like to see OppenheimerFunds' institutional business grow, Mr. Darling said no specific goal has been set but that "low double-digit" growth would be acceptable.
"We know this business is lumpy," he said, explaining that new business comes in sporadically rather than steadily.
