Researchers put BT on hold

Managed fund researchers have reacted cautiously to Deutsche Bank's surprise announcement that it is selling BT Funds Management.

Wednesday, March 24th 1999, 12:00AM

Managed fund researchers have reacted cautiously to Deutsche Bank's surprise announcement that it is selling BT Funds Management.
Researchers in Australia and New Zealand have put the company on hold which means funds flow into BT products is likely to be a decrease during the sale period.
IPAC says whenever there is a merger or takeover the target company is put on hold until its future direction is assured.
Researcher Daniel Frost says the message to investors at this point is to leave their money with BT, but don't add to it.

Mercer Investment Consulting chief executive Louis Boulanger says there is no one message for investors as BT funds can be used in a number of different ways in portfolios.
"Our recommendation (to clients) will not be that they sit on their laurels."
Boulanger says Mercer clients will receive a letter on Thursday discussing issues and possible outcomes of the sale, as well as highlighting some of the risks.
He says they will not be recommending people add to their BT holdings.
FPG Research managing director Graham Rich says BT's five star company rating is currently suspended and a new rating is being developed.
BT will be downgraded when a new rating is published on Monday. The reasons for the downgrade will relate to qualitative issues such as corporate strength.
"The rating will be downgraded as there are a significant number of items of uncertainty."
While the rating is suspended it is "inappropriate (for investors) to take any action," he says.
Although FPG has suspended BT, Rich is confident the outcome of the sale process will be positive
"(BT is) still materially more attractive than lower calibre managers in a stable condition," he says. "(BT) is in a somewhat unstable state, but high quality."
He says, "the final outcome of the sale will be materially better for investors than was previously the case."
FPG is comfortable with the rationale behind Deutsche Bank's decision to sell BT.
Click here to find out BT's view of the situation.

« Deutsche Bank gets rid of its inheritance

Get your tax questions answered online »

Special Offers