INVESCO has a balanced fund. So does AIM Funds. INVESCO offers a telecommunications fund. So does AIM. INVESCO has the Real Estate Opportunity Fund. AIM offers the AIM Real Estate Fund.

From value to growth to tech to sector products, the offerings of the two firms, which are both owned by British holding company AMVESCAP, are markedly similar. So, when INVESCO announced late last month that, like AIM, it will charge loads on its products and sell them mostly through intermediaries, industry observers wondered if there was room under the AMVESCAP umbrella for two load shops.

Perhaps AMVESCAP would combine the brands, some speculated. Or perhaps AIM and INVESCO would trim their product lines to complement each other.

Spokesmen at INVESCO and AMVESCAP say none of the above is likely to happen anytime soon. The firms will remain distinct, they say. There will be no merging of brands and there will be no trimming of product lines. "They may in fact go after different intermediaries," said AMVESCAP spokesman Doug Kidd. "They may target each other. There's no cross-selling. There's no subdividing the universe. These are two full-fledged competitors."

INVESCO's move to loads, which will be finalized in March of next year, means INVESCO has dived full-force into an increasingly cutthroat intermediary channel where AIM has been operating for years. But spokesmen for the companies say that the firms competed before they were brought under the AMVESCAP umbrella three years ago. And competition has been increasing since INVESCO began offering loaded C and K shares in 1998.

That has fueled speculation as to whether two separate AMVESCAP brands offering similar products can coexist. Tony Cummings, an analyst at Bear Stearns in London, concludes that, whatever AMVESCAP says, the company will eventually merge its brands. In fact, he says, the company may not be able to afford any other option. "I see some sort of cannibalization of AIM's sales as a result of INVESCO and vice versa," he said.

Cummings suspects that the firms will first take on the Herculean challenge of merging their back-office systems, where trades are recorded and settled. He thinks a merger of the brands may not be far behind.

The reason, he said, is that consolidation would give AMVESCAP more clout. For example, combining the assets of both AIM and INVESCO makes AMVESCAP the fifth largest U.S. firm in terms of assets under management, he said. In addition to lowering costs through improved economies of scale and operational efficiencies, a single, larger entity may make it easier for the firm to negotiate better deals with online supermarkets and other distributors whose shelf space is key to driving sales.

It's possible that the companies could operate side by side, he said, but consolidation is "at some stage inevitable."

But AMVESCAP insists that consolidating AIM and INVESCO would destroy two brands that have been successful independent of one another. "We've had two successful brands that enjoy shelf space," Kidd said of the AIM and INVESCO product lines. "It makes absolutely no sense in this day and age to abandon a brand that has been successful."

History tells a different story. In recent years INVESCO and AIM have merged with several firms internationally and, within months of those mergers, combined the brands. For example, in fall of 2000, when INVESCO acquired a U.K. fund complex called Perpetual, it merged the U.K. brands: INVESCO-Perpetual. And, in Spring of 2000 when AIM merged with a Canadian fund shop called Trimark, the Canadian brand was also merged: AIM-Trimark.

Other marriages between fund complexes of similar product lines and sales strategies have resulted in the merging of brands. After Scudder acquired Kemper, for example, the Kemper brand eventually disappeared from the product lineup after Scudder shifted to mostly load products in December 2000. That same month, the firm filed with the SEC to merge three of its funds into the Kemper Total Return fund and change its name to Zurich Scudder Investments. Mergers of other funds followed.

INVESCO, which has about $23 billion under management, has not yet filed with the Securities and Exchange Commission for its new loaded share classes, but the firm expects to charge around 5%, a company spokeswoman said. AIM, meanwhile, says it charges loads of no more than 5.5%. INVESCO offers 23 funds, while AIM's line includes 53 products. And both firms have been clobbered by market declines. In fact, through October, AIM's assets dropped 36% and INVESCO's assets had dropped 44%, according to Financial Research Corp. of Boston.

Despite similarities between the two firms, AMVESCAP's Kidd said shelf space is a big reason for keeping the brands distinct. "It certainly is not uncommon in the industry in general to successfully support a multibrand strategy," he said. "Two good brands are better than one. That continues to be the case."

Meanwhile, more AIM funds are on the way, said Morningstar analyst Bridget Hughes. That leads her to believe that the brands will remain distinct. In the coming months, AIM will launch the AIM Core Strategies Fund, the AIM Total Return Bond Fund and a new large-cap equity product.

A firm that is planning to merge its brand isn't likely to file a bunch of new products with the SEC when it will have to turn around and file again in order to change their names, Hughes said.

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