Boston-based data provider Financial Research Corp. (FRC)  has decided to stop providing fund flows data to the media that identifies companies by name — figures that while closely watched were a source of constant irritation to some firms.

News reports based on the monthly data by FRC, part of Citigroup, had rankled Fidelity and some other fund companies because the figures excluded money market fund flows and only included flows of stock and bond funds.

Over the past few years, Fidelity and other asset managers reported robust inflows into money market funds but received bad press because the FRC data excluded those figures.

For example, FRC numbers showed that Fidelity saw outflows of $9.9 billion in January.
But the world’s biggest mutual fund company reported inflows of $14.4 billion that month, driven by money market fund inflows of $20.3 billion.

That nuance was often lost in headlines focusing on FRC’s bond and stock fund flow data — figures that had become industry benchmarks.

Putnam Investments, the Boston-based unit of Canada’s Power Financial Corp, has regularly topped FRC’s list of companies seeing the biggest outflows.

FRC may provide the firmwise data to companies as a paid service.

Other companies which track fund flows include Strategic Insight, Emerging Portfolio Fund Research and Lipper Inc, a unit of Thomson Reuters.

Photo credit: Reuters

Pearlstine used to be the editor-in-chief of Time Inc for 11 years, and before that spent 23 years at The Wall Street Journal. More details on his CV, directly from the release :

He was the paper's top news executive for nine years, serving as Managing Editor and then Executive Editor. He previously worked as the founding editor and publisher of The Wall Street Journal/Europe, the first Managing Editor of The Asian Wall Street Journal, and the Tokyo bureau chief.

Pearlstine was founder of Smart Money magazine and worked as an Executive Editor of Forbes. He is the author of OFF THE RECORD: The Press, the Government, and the War over Anonymous Sources , published by Farrar, Straus and Giroux in 2007.

We don't know what to make of this. Our immediate questions:

- Will he succeed Winkler, with whom he worked at the Journal?

- Will he put Bloomberg into M&A mode?

- Will he work on an effort to take Bloomberg LP public? (This idea has come up at least once before)

Pearlstine wasn't available for comment, so we'll just publish our questions here and invite comments, but Bloomberg's top editorial executive, Matt Winkler, did  call. Here's a bit of what we talked about:

Q: Why Pearlstine?

A: Nobody brings as much experience in so many different ways as Norm does... Our hope is that Norm can give us a lot more awareness and guidance on ways we can deliver [our news] well beyond the Bloomberg.

Q: When did you first meet him?

A: The meet-and-greet was probably in the halls of Dow Jones & Co when I arrived in 1980, and he was the national news editor at The Wall Street Journal. People would point him out to me as a really important person you ought to know, so maybe on the way to the men's room I was able to introduce myself. (They started working closely together in 1982 when Pearlstine was planning the European edition of the WSJ and asked Winkler to go to London)

Q: What do you think of him?

A: I would say that everything that I know that's worth anything in this business, the news business, I can attribute to Norm.

Q: Does his new job at Bloomberg mean that you will retire?

A: I would hope that I'm just getting started, actually.  The first 18 or so years went by really fast. I think the biggest opportunities are ahead of us. I can't wait to go at them with Norm at my side.

Q: By the way, is there a hiring freeze at Bloomberg?

A: Not exactly. The management committee at Bloomberg... saw what was unfolding with the financial world -- they could see what was coming last July -- and said, 'what we want to do for the coming year is effectively freeze the headcount.' (This does not mean that they are not hiring as people leave, however) We're determined to find and identify and bring to Bloomberg the most talented, skilled journalists we can.

(Reuters photo shows Pearlstine on the left in his role as president of the American Academy in Berlin, German Chancellor Angela Merkel in the middle and former U.S. ambassador to Germany Richard Holbrooke on the right.)

(Disclaimer that you've probably read before: Bloomberg and Thomson Reuters are competitors in providing financial news and data.)

Add radio broadcaster Cumulus Media to the pile of ditched deals. The $1.3 billion management buyout of the company ended after the investor group failed to agree on the transaction terms. The deal was announced in July last year. It called for Cumulus’ Chief Executive Lewis Dickey, other Dickey family members and an affiliate of Merrill Lynch Global Private Equity to buy Cumulus for $11.75 in cash per share, a 40 percent premium at the time. The investor group has agreed to pay Cumulus $15 million in termination fees.

International Lease Finance Corp, a unit of American International Group, is worried by the insurer’s financial troubles and mulling a split from it, according to the Wall Street Journal. Citing people familiar with the matter, the Journal said ILFC, a giant buyer of commercial aircraft that leases planes to air carriers, is worried that AIG’s financial issues could make it tougher for ILFC to compete in the airplane leasing industry. Last week, AIG posted a $7.8 billion quarterly loss after writing down assets linked to subprime mortgages.

Australia’s Westpac is bidding $14 billion to buy smaller rival St George Bank. The deal would create the country’s biggest bank by market value. The proposal by Westpac’s new Chief Executive Gail Kelly, who joined the bank less than four months ago after heading up St George for nearly six years, is seen possibly igniting a wave of consolidation in the country’s financial sector.

Other deals of the day:

* British-based electricity firm International Power has agreed to buy four U.S. power generation plants for $856.4 million to expand its presence in the country, it said.

* State-owned Philippine National Oil approved the sale of Saudi Aramco’s 40 percent stake in oil refiner Petron at a board meeting, officials said. Aramco has said it would sell the Petron stake to London-based investment fund Ashmore Group for $550 million.

* Singapore Telecommunications is actively involved in potential takeover talks between India’s top mobile firm, Bharti Airtel, and South African operator MTN Group, a source familiar with the situation told Reuters.

* Vodafone Group, the world’s largest mobile phone group by revenue, has no intention of pursuing a bid for South African company MTN, a spokesman said.

* India’s No. 2 mobile operator, Reliance Communications, may announce a network management joint venture with French-American telecoms equipment provider Alcatel-Lucent, a source familiar with the situation said.

* Khan Resources offered to buy Western Prospector in a move to consolidate operations and jointly develop uranium deposits in the Saddle Hills district of Mongolia.

* Britain’s largest care-home operator, Southern Cross Healthcare, is looking at buying Britain’s fifth-largest provider Craegmoor Healthcare, its CEO said.

* Britain’s Chloride Group, whose products protect against power shortages, said it had rejected a bid approach that it said materially undervalued the company.

That goes to show you what they say about assuming things.

The Wall Street Journal reported on Saturday , and we subsequently confirmed , that News Corp isn't going to chase Newsday after all. Instead, it's pulling its $580 million bid, paving the way for Cablevision to likely take over its fellow Long Island media outlet. New York Daily News owner Mortimer Zuckerman is in the race still as far as we know, but it's hard to see how Tribune will take his $580 million bid when Cablevision has a $70 million sweetener on top of that.

Why? Apparently the economics were unjustifiable. What could that mean? The short list: Tribune's quarterly financial results, which came out late Friday, show the company continuing to lose advertising revenue at its newspapers; media ownership laws might make it tough for Murdoch to take the paper yet keep his New York-area television broadcast licenses; and finally, a bid higher than $650 million is already a higher valuation for a newspaper than most sensible financial folks see as feasible.

That didn't seem to bother Murdoch before. Here's what he said on the News Corp earnings call (reproduced from our earlier blog entry ):

No, I don't think Cablevision will prevail. Just be patient for a couple of days (inaudible). We're certainly not in the business of getting into an auction here ...

We're hoping to wrap it up within the next week. And I don't mean the end of next week, I mean within the next seven days ... It takes two to agree. But we're at a pretty advanced stage. I'll just leave it at that at the moment.

Here's what he subsequently said at the Time 100 dinner later that week, according to the New York Observer (whose owner Jared Kushner also was interested in bidding, though a source close to Kushner Properties told us recently that he has no idea what he wants to do about a bid right now -- we're guessing nothing):

"Yeah, I might have gone a little too far saying it was a certainty," he told The Observer. "I was telling the truth, but you don't know until ..."

Until Saturday.

Still, in case anyone had doubts, one hedge fund apparently felt compelled to clarify exactly what employees can expect if they happen to die, an event that might affect their ability to show up for work and contribute to the essential work of making partners stratospherically wealthy.

In their latest 10-Q regulatory filing hot off the presses today, hedge fund giant GLG Partners disclosed that it included the following stipulation in an employment contract for its CFO Jeffrey Rojek:

“The Employee’s employment with GLG will automatically terminate upon his death.”

Well that settles that. Don’t die or you’ll get fired. At least they warned him.

“The fund industry has to make a real commitment, not lip service, to diversity. And really go out of our way to find people of color to work in our organizations,” Ariel president Mellody Hobson told Reuters in an interview on Thursday.

Ariel has long championed the cause of spreading financial literacy in the African-American community. Founder John Rogers is helping raise support and funds for Barack Obama.

“Name any well-known black portfolio manager besides John Rogers,” Hobson said on the sidelines of the annual Investment Company Institute (ICI) conference. “And, to our knowledge, I am the only black woman chair of a mutual fund board. That’s not progress,” she said. Hobson chairs the board of trustees of Ariel’s mutual funds.

Rogers is chairman, CEO and chief investment officer of Chicago-based Ariel, which had $11 billion in assets under management at the end of March.

“We, as an industry, have a very very very long way to go. And I think it’s more disconcerting when you look at private equity, when you look at hedge funds, there’s no diversity at all,” Hobson added.

Some senior executives of the $11.7 trillion U.S. funds industry agreed with Hobson’s view on the lack of diversity.

“I think it varies by the types of roles. I think among the investment management professionals, there is less diversity than all of us would like,” said Edward Bernard, vice chairman of T. Rowe Price Group

The WSJ recently reported that Microsoft is sniffing around Facebook, less than seven months after investing $240 million in the social network at a $15 billion valuation. It was largely discounted as the hopeful fumblings of Steve Ballmer, in his search for a rebound acquisition after being dumped by Yahoo. But it got me to thinking: Microsoft’s initial investment may be one of the worst venture capital deals of all time.

Click here to read the full article.

On a related note, check out this uncomfortably literal depiction of Facebook from BBC’s “The Wall.”

Your middle-class parents have a combined household income of $115,000. You receive an allowance of $20 per week. If you save all your allowance for two years, how much debt will you have to finance to hostilely take over your family? How will you structure the debt?

Citigroup

“The only reason you’d sell off that many assets is you have a lot more losses coming than you originally thought,” said Jim Huguet, co-chief executive at fund manager Great Companies LLC, which does not own Citi shares. Since late last year, Citi has recorded more than $45 billion of writedowns and credit losses, raised more than $40 billion of new capital including $2 billion of preferred shares this week, and slashed its dividend 41 percent. The Financial Times, which first reported the story on Thursday, said the moves would take place over several years.

Global economic instability has created huge investment opportunities for China Investment Corp, but the sovereign wealth fund’s head said he will be careful not to destabilize countries where it operates. CIC paid $5 billion in December for a stake in U.S. investment bank Morgan Stanley but has otherwise kept its powder dry as Western financial institutions have sought to replenish capital depleted by big subprime credit losses. “The current international market turbulence has produced unprecedented investment opportunities,” said Lou Jiwei, head of the $200 billion sovereign wealth fund. “In the 1990s, some hedge funds exploited defects in the macroeconomic policies of some emerging economies and attacked them, which damaged their economies and caused hardship for people,” he said. “CIC will certainly never do a similar thing.”

Sovereign Bancorp, the second-largest U.S. savings and loan, plans to raise just over $1 billion in an equity offering to help it navigate a difficult economic environment, according to a person close to the transaction. The offering will be broadly distributed to institutional investors and will likely be conducted over the weekend. Sovereign is determining how much Banco Santander, which has a 24.99 percent stake in the thrift, might participate in the offering, while keeping any transaction with the Spanish bank at arms-length, the person said.

Google expects to launch new products for its YouTube Web video service in the next few months and sees reason for closer cooperation with Yahoo, Google Chief Executive Eric Schmidt said. Schmidt has said getting the video sharing site to make money is the Web search company’s top priority for the year. He did not give details of the products, however, and they are not even in beta testing. The Web search leader played a large role in the takeover battle between Microsoft and Yahoo. During a two-week test, it sold search advertisements on rival Yahoo last month as part of Yahoo’s attempt to find an alternative option to Microsoft’s offer. Schmidt said the trial run provided good reason for the companies to discuss cooperation, but there was no deal yet.

Other deals of the day:

* U.S. private equity firm The Carlyle Group will lead a 58.1 billion yen ($560 million) management buyout of an LCD glass venture jointly owned by Japan’s Hoya Corp and Nippon Sheet Glass, Hoya said.

* Norwegian aluminum group Norsk Hydro said it has agreed to buy privately owned Spanish aluminum building systems group Alumafel for 77 million euros ($118 million).

* Shares in British engineering software firm Flomerics Group surged after rejecting a buyout offer from larger U.S. rival Mentor Graphics, saying it would explore interest from several other parties.

* A local fund managed by U.S-based Lombard Investments plans to buy 10 percent of Asiasoft Corp, Thailand’s top online gaming firm, for up to $11.3 million, partly via an IPO this month, an IPO underwriter said.

* Australia’s Macquarie Group is interested in buying a key part of German power giant E.ON as it prowls for investment opportunities, one of its top managers said.

Now I feel like garbage I read the Star Trib online and don't subscribe to the actual physical paper. Sorry .. guys! I would gladly pay to use the site here .. give it a thought. I am serious .. I will pay.

This comment was attached to an article posted to the Strib's Web site on May 6 that revealed that the paper's owner had to write down 75 percent of the $100 million it paid for its stake. Private equity firm Avista Capital Partners engineered a purchase of the paper from McClatchy Co, which was announced in 2006. Since then, the paper has hemorrhaged revenue, just like many other big-city dailies.

The write-down, taken at the end of 2007, reflects the estimated loss of value and is consistent with the falling stock prices of publicly held newspaper companies such as McClatchy and the New York Times. Avista's public accountants required the private equity firm to write down or "mark to market" the estimated value of the Star Tribune.

The memo denied a recent report in the New York Post that the Star Tribune may file for bankruptcy.

"The Star Tribune currently has sufficient liquidity and is up to date on all its debt payment obligations," said the memo, distributed by Avista.

And if this turns out to be wrong, daphne3620 and all her freeloading friends will have to pay a very big price indeed. (Me included.)

(Photo: Reuters)