United Asset Management Corp. (UAM) is in talks to sell its Pilgrim Baxter & Associates, Ltd. subsidiary to Nationwide Financial Services, Inc. UAM, of Boston, would only confirm that talks were being held. A Pilgrim Baxter spokesman declined to comment.

Pilgrim Baxter, based in Wayne, Pa., has struggled this year with net redemptions in its 14 funds. Pilgrim Baxter's assets under management have decreased from approximately $16.6 billion as of Dec. 31 to approximately $12.5 billion through August.

The company has suffered about $2 billion in net redemptions this year, according to Tom Tyson, an analyst at Financial Research Corp. (FRC), a Boston-based fund consultant and tracking firm.

Pilgrim Baxter, known for its small capitalization investing, attracted investors inclined to move money quickly in and out of its funds after they performed strongly in 1996. As performance has deteriorated, shareholders have redeemed, Tyson said.

Nationwide, an insurance and financial services company based in Columbus, Ohio, would provide Pilgrim Baxter with a large sales force to distribute its funds.

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