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Dundee AMC to be Wound Up

With its announcement to wind-up its Indian operation, Dundee becomes the seventh fund house to shut shop. The spate of exits signals the maturing of the fund management business, in an-otherwise rapidly growing industry.

The trustees of the Dundee Mutual Fund have announced the winding up of its six schemes - Dundee Liquidity (cash fund), Dundee Sovereign Trust, Dundee Bond: Corporate, Dundee Bond: Public Sector (its two versions of medium-term bond funds), Dundee Taxsaver and Dundee Balanced. Together, the AMC manages assets worth Rs 15 crore. The trustees have convened a meeting of unit-holders on January 19, 2003, to seek their approval for the closure.

The exit of Dundee from the fund management business will be the seventh since the opening up of the sector to private players in 1993. The others include Anagram, Apple, BoI Mutual, CRB Mutual, Indbank and Shriram Mutual. This list does not include the merger of ITC Threadneedle with Zurich and Credit Capital with Taurus.

The decision to close down is primarily triggered by the fund house's inability to find takers for its funds. In the absence of any compelling performance, scale of operations or meaningful distribution, it offered little advantage to a new entrant or an existing player.