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Daiwa Mutual Fund is likely to ask 20-25 of its employees to leave the company in the next few weeks, after the firm got the final approval from Sebi last week to sell its India assets to SBI Mutual Fund. “About 20 employees from the non-investment side will be asked to go in a few weeks after the transition is over,” said a person familiar with the matter. However, the company has not surrendered its MF licence and will continue to manage a few India-dedicated offshore funds. “The company will retain a few analysts and fund managers, including key people from the compliance, HR & administration and accounts departments,” said the person, adding that the investment team would now handle Daiwa’s offshore funds.
About 15-20 people have already quit the fund house earlier this year, mostly on the sales and operations side. According to sources, the employees who have chosen to stay till the end will get a compensation of 6-18 months’ salary depending on the seniority and duration of stay with the fund house. The fund house had about 60-65 people on its rolls last year.
Sources said the company has offered a generous severance package to its employees. “Unlike some of the Indian AMCs, the Japanese management of Daiwa has been transparent and has adequately compensated their employees,” said the person quoted above. He added that the asset manager had communicated its intention to sell its India assets by September last year, several months before inking the deal with SBI MF, giving ample time for employees to find jobs.
An email sent to Daiwa MF asking it to elaborate on its compensation package and plans for the future went unanswered at the time of going to press.
The fund house’s assets under management (AUM) dipped to about R131 crore at the end of June 2013 from R709 crore a year earlier. While the exact worth of Daiwa’s offshore funds could not be ascertained, three of its offshore India-focusssed funds, as tracked by Morningstar’s global database, cumulatively managed about $150 million at the end of August 2013.