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American Express Expected to Buy Asset Management Firm

June 16, 2003|From Times Wire Services

American Express Co., the fourth-largest credit card issuer, is expected to announce as early as today that it is buying British-based Threadneedle Asset Management for $567 million in cash, sources familiar with the deal said.

For New York-based American Express, this would be its first major entry into the asset management market outside the U.S. The deal is expected to be approved by Zurich Financial Services, Threadneedle's parent and the largest Swiss insurer, the sources said.

American Express is expected to retain most of Threadneedle's staff and the British firm's chief executive, Simon Davies, is expected to run the business from London.

By purchasing Threadneedle, American Express gains institutional clients with $75 billion in assets, including British American Tobacco and Agfa Gevaert, a maker of photographic film.

American Express has been taking steps to bolster the fund division. It hired three portfolio managers from Fidelity Investments last year and started at least 14 funds to lift returns.

American Express declined to comment. Neither Zurich Financial nor Threadneedle could be reached Sunday.

Bloomberg News contributed to this report.

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