Orion Asset Management has decided to scrap its funds management services for institutional clients over the upcoming weeks.
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The move will see a number of the group’s investment management team leave the business, Financial Standard has reported.
Treasury Group, which owns a 42% stake in Orion, in its filing with Australian Securities Exchange (ASX) said the decision was led by Orion’s own management team.
"The restructuring will lead to a reduction in costs and an increase in profit when compared to Orion’s profitability during the current quarter. As part of the restructure, excess cash will be paid to shareholders by way of dividends," the announcement said.
Treasury Group also said that Orion will continue to manage the Orion Wholesale Australian Share Fund for its retail clients, while Tim Ryan, founder and chief investment officer, will also stay with the firm.
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By GlobalDataTreasury Group further revealed that it will acquire an additional 7.9% equity stake in Orion Asset Management taking its total stake to 49.9%. The legal documentation in relation to the restructuring is expected to be executed before to 31 December 2013.
