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COPYRIGHT 2001 Crain Communications, Inc.
Insurer faces doubts on eve of IPO party
With three insurance companies set to go public this year, including his own, Robert Fiondella must feel like the ugly stepsister on her way to the ball.
After all, the CEO of Phoenix Home Life Mutual Insurance Co. is still wiping from his face cake thrown by one of its biggest business partners.
Last February, in an unpublicized move, Merrill Lynch & Co. Inc. terminated Phoenix's Duff & Phelps money management unit from its Consults managed account program.
In a letter to its brokers obtained by InvestmentNews, Merrill cited chronic turnover of the unit's investment team since 1997, and the February departure of veteran equity portfolio manager Diane Mustain.
Phoenix declined to comment, but others say the damage could be significant.
"The managed-account business is the one they are most proud of as far as growth potential," adds Rick Marano, a director and analyst with Standard & Poor's in New York.
"If they are losing a big chunk of money in 2001 from that account, there are not many other stars in that particular business that they can point to," he says.
SPOILED PARTY...
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