JPMorgan has acquired Investia's majority holding in loss-making outsourced fund supermarket solutions joint venture FundsHub.
The US investment bank is buying founder-shareholder Investia's holding in FundsHub for an undisclosed sum. FundsHub was formed in April 2000 as a $20 million joint venture between Investia and JP Morgan to provide outsourced fund supermarket solutions in Europe.
The FundsHub management team and JPMorgan - via JPMorgan Investor Services and JPMorgan Partners - say they are injecting sufficient new capital into the business to take it through to profitability.
Mark Lund, chief executive of FundsHub, comments: "This is a positive step forward for our business and will give a new focus and sense of independence for FundsHub after a remarkable year for the company."
He says the new ownership structure will secure the company's future.
FundsHub has so far won contracts to provide outsourced fund supermarket solutions to German insurance group Gothaer, the UK's Charcol Online, and Old Mutual's new fund multi-manager Selestia.
Mark Tennant, senior vice president, JPMorgan Investor Services, says: "This additional commitment to FundsHub is evidence of our continuing belief in the increasingly important role that funds supermarkets will play in Europe as open architecture becomes the norm."
He points to industry analyst estimates that funds supermarkets will be a very important method of fund distribution. "One such survey, suggests that as much as 25% of net European inflow to funds will be via funds supermarkets by 2004," he adds.
However, Datamonitor also warned in November of impending consolidation for the UK fund supermarket business, with demand from the retail investment market unable to sustain the number of players touting for business.