Pilgrim Group Mutual Funds to Break Up
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After months of controversy that drained its assets, the Century City-based Pilgrim Group mutual fund company said Wednesday that it will disband.
The firm said its staff and six of its 10 funds, with assets of $1.15 billion, will be sold to Express America Holdings, an Arizona mortgage banker, for $28 million.
Pilgrim CEO Palomba Weingarten will retain four other Pilgrim funds with $750 million in assets--Pilgrim Adjustable U.S. Government Securities Trust, Pilgrim Adjustable Rate Securities Trust, Pilgrim Short-Term Multi-Market Income Fund II and Pilgrim All-Americas Government Income Trust--under a corporate name yet to be chosen.
Weingarten was censured last spring by the National Assn. of Securities Dealers for ads that the NASD judged to be misleading.
Though penalties were reduced in September, the controversy surrounding her and the Pilgrim funds has caused business to fall off and prompted some fund shareholders to sell. Many industry analysts had speculated recently that the company would be sold.
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