Federated Investors Inc., the third-largest U.S. provider of money funds, has acquired $903 million in stock, bond and money-market assets from Trustmark Corp. Terms weren’t disclosed.
Trustmark’s Performance Funds Trust will be reorganized into Federated funds with similar investment objectives, the companies said today in a joint statement. Pittsburgh-based Federated will take over $571 million in money-market mutual fund assets, and the remainder in equities and fixed income.
The purchase comes as the money fund business faces proposed new rules that Federated Chief Executive Officer J. Christopher Donahue has said would kill the $2.5 trillion industry. U.S. Securities and Exchange Commission Chairman Mary Schapiro delivered to fellow commissioners on June 25 a plan that would force money funds to choose between floating their traditional $1 share price or adopting capital reserves and redemption restrictions. Schapiro has yet to secure enough votes to approve the plan.
“We remain very interested in additional similar transactions,” Donahue said in the statement.
The companies plan to ask Jackson, Mississippi-based Trustmark’s fund shareholders to approve the reorganizations in September, the firms said in the statement. Trustmark is a publicly traded company that provides banking and other financial services through offices in Florida, Mississippi, Tennessee and Texas.
Federated manages about $364 billion, including $231 billion in money market mutual funds, according to data from the company and research firm Crane Data LLC in Westborough, Massachusetts.