Mumbai, Aug. 29: DSP Merrill Lynch Limited (DSP ML) plans to raise its stake in fund-management subsidiary DSP Merrill Lynch Investment Managers Limited (DSP MLIM), from 60 per cent to just under 100 per cent, in a bid to simplify the company’s management structure and streamline Merrill Lynch’s investments in India.
DSP MLIM is a joint venture between DSP ML and Merrill Lynch Investment Managers (MLIM). DSP ML will purchase the 40 per cent stake currently held by Merrill Lynch Investment Managers through its affiliates. Merrill Lynch will continue to have a 40 per cent stake in DSP MLIM through its 40 per cent stake in the DSP ML joint venture.
Explaining the restructuring, an official statement said it would streamline ownership at DSP MLIM for effective transfer of administrative function to the local management team. It will allow DSP ML’s management to respond quickly to the local business environment and carry out growth initiatives, the statement added.
However, Merrill Lynch will continue to be involved with the asset management company through its representatives on the company’s board.
Merrill Lynch Asia Pacific chairman and director-to-be on the DSP MLIM board Check Low said, “We are strongly committed to India and the DSP ML joint venture model has been very successful for both partners. By aligning DSP MLIM’s ownership structure with that of our other businesses in India, we hope to achieve even greater success in the attractive long-term fund management business”.
DSP ML chairman Hemendra Kothari said, “We appreciate the confidence that Merrill Lynch has in the local management team, which has indeed helped to create a leading domestic investment bank with all the benefits of a global organisation.”
“With this move we expect to initiate a fresh focus in funds management in India, while running the business in line with global Merrill Lynch structures, practices and vision.”