The Principal Financial Group of Des Moines, Iowa has acquired a stake in India's largest financial service provider, IDBI Investment Management Company, and created a joint venture that will be named IDBI-Principal Asset Management Company. IDBI Investment Management Company is the asset management unit of the Industrial Development Bank of India, based in Mumbai, India.
The joint company will sell both mutual funds to Indian citizens and 401(k) plans to proprietors of small to mid-sized Indian companies. The Principal brings to the alliance, its expertise as the largest issuer of 401(k) plans to U.S. small to mid-sized companies.
"We know how owners think and how they purchase retirement plans," said Norman Sorensen, president of The Principal International.
The new firm will also sell a family of long-term balanced funds, he said. IDBI-Principal will be targeting 40 million Indian households. The Principal will take advantage of IDBI's vast distribution channels.
Last week, The Principal also signed a preliminary agreement to form a joint venture with Bank Mandiri in Indonesia. The Principal also has subsidiaries in Argentina, Australia, Brazil, Chile, Hong Kong, Japan, Mexico, Spain and the United Kingdom, and maintains an office in the People's Republic of China.