Federated Investors' Mutual Funds to Acquire Approximately $470 Million in Assets from Riggs Funds
Eight Riggs equity, fixed-income and money market funds to transition into eight existing Federated funds
(Pittsburgh, PA, ) — Federated Investors, Inc., (NYSE: FII) and Riggs National Corporation (NASDAQ: RIGS), announced today that a definitive agreement has been reached between Federated Investors, Inc. and Riggs Investment Advisors, Inc. and Riggs Bank N.A., subsidiaries of Riggs National Corporation, concerning the proposed sale of approximately $470 million in mutual fund assets of eight Riggs mutual funds to eight existing Federated funds. The financial terms of the definitive agreement were not disclosed.
The announcement was made by J. Christopher Donahue, president and CEO of Federated Investors, Inc., and Robert L. Allbritton, chairman and CEO of Riggs National Corporation. The boards of directors of the Federated Funds and the Riggs Funds unanimously approved the planned transitions, which are now subject to the approval of Riggs Fund shareholders. It is anticipated that the Riggs Fund shareholder meeting to approve these transactions will be held in September 2003.
“Federated’s long history of serving Riggs, coupled with our broad investment expertise, provides an ideal opportunity for Riggs to transition its mutual fund franchise into eight historically strong Federated funds,” said Donahue. “Federated will continue to pursue growth through other bank fund asset transactions as we’re witnessing a strong trend toward these opportunities.”
“Riggs is committed to providing our wealth management clients with an open architecture service model that emphasizes institutional-quality asset allocation and a wide selection of high-quality investment products,” stated Allbritton. “This transaction makes strategic sense for Riggs and delivers value to Riggs’ shareholders. It also ensures that our fund shareholders will have a solid financial partner. With its significant breadth of competitive investment products and a thriving franchise, Riggs has valued and trusted Federated for more than twenty years.”
The Riggs asset breakdown as of July 16, is as follows: $47.5 million in two domestic equity funds, $127.9 million in four fixed-income funds and $294.2 million in two money market funds.
Voting separately by fund, shareholders will be asked to approve the following transfers:
|Riggs Mutual Funds||Federated Mutual Funds|
|Riggs Stock||Federated Capitial Appreciation-A|
|Riggs Small Company Stock||Federated Kaufmann Fund-A|
|Riggs U.S. Government Securities||Federated Total Return Govt. Bond-SS|
|Riggs Bond||Federated Total Return Bond-SS|
|Riggs Short Tax Free Bond||Federated Shory Muni Trust-SS|
|Riggs Intermediate Tax Free Bond||Federated Intermediate Muni Trust-IS|
|Riggs Prime Money Market Fund||Federated Automated Cash Management Trust-SS|
|Riggs U.S. Treasury Money Market||Federated Automated Government Trust|
Prior to this announcement, Federated had acquired approximately $3.9 billion in mutual fund assets since 2000. These transactions include $346 million in primarily equity fund assets from Investment Advisors, Inc., $148 million from three mutual funds from Lincoln Investment Planning, Inc. and $250 million in money market and equity assets from FirstMerit Funds, all of which were merged into existing Federated funds. The $3.2 billion acquisition of the prominent Kaufmann Fund, now called the Federated Kaufmann Fund, was finalized in April 2001.
Riggs National corporation. The largest bank holding company headquartered in the nation's capital, has 48 branches in the Washington, D.C. metropolitan area, as well as locations in Miami, London, Channel Islands and Berlin. Riggs commands the largest market share in the District of Columbia and specializes in banking and financial management products and services for individuals, nonprofit organizations, and businesses. Riggs is also the dominant financial institution serving embassies, both in the United States and abroad.
Federated Investors, Inc. is one of the largest investment managers in the United States, managing $196 billion in assets as of March 31, 2003. With more than 135 mutual funds, various separately managed accounts and closed-end funds, Federated provides comprehensive investment management to more than 5,900 institutions and intermediaries including corporations, government entities, insurance companies, foundations and endowments, banks and broker/dealers. Federated ranks in the top one percent of money market fund managers in the industry, the top four percent of fixed-income fund managers and the top five percent of equity fund managers.1 For more information, visit FederatedInvestors.com.
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