Distressed markets, low values to spur fund M&A

Nov 4 - Reuters - A U.S. asset manager shakeout looms as struggling banks line up to sell their mutual fund arms to raise capital and fund companies exit the money-market segment, hoping to cut losses.

The global financial crisis may also force companies with strong brands, such as Janus Capital Group Inc, into the hands of a private equity firm or a publicly traded rival, analysts and executives said.

"What's happening now is as part of the knock on effect of October. You are seeing a lot of firms come on to the auction block as potential rescue trades from distressed sellers," said Benjamin Phillips, research director at consulting firm Casey, Quirk & Associates LLC.

Asset managers are weathering the crisis better than banks, which have been clobbered by massive write-downs and exposure to losses in subprime mortgages that snowballed into the worst financial crisis since the 1930s. Read more.