Facing a third-quarter loss of 2.5 billion euros, what will Allianz AG of Germany do with its Newport Beach, Calif., fixed-income manager PIMCO Advisors? Allianz has owned a 70% majority of PIMCO since May 2000. PIMCO has $301 billion in assets under management.

Published reports hint that PIMCO's mutual fund unit is either being polished up for a spin-off, or a sale. A spokesman at PIMCO denied the reports.

With $64.5 billion in assets, the PIMCO Total Return Fund is the largest U.S. bond fund. Its European counterpart, the Euro Bond Total Return fund, introduced this May, has become one of the best-selling funds in Germany this year.

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