The company revealed the plan in a Securities and Exchange Commission (SEC) regulatory filing to liquidate the assets in the Janus Institutional Money Market Fund and Janus Institutional Government Money Market Fund on April 30, 2009.
“This plan is reflective of Janus Capital Management LLC’s analysis of the competitive institutional money market business and current trends regarding the future of that business,” Janus said in the SEC filing.
The funds stopped accepting new money January 22, and will no longer take deposits from existing shareholders as of February 2. Janus said shareholders can redeem or exchange their shares before the liquidation date and that if a shareholder has not done so by that time, the account will be automatically redeemed and proceeds will be sent to the shareholder of record.
The company warned shareholders that Janus portfolio managers might need to increase the amount of cash and liquid instruments to pay fund expenses and meet redemption requests.
Janus asserted in the SEC document: “The liquidation and closing of the Funds to shareholders may result in large shareholder redemptions, which could adversely affect a Fund’s expense ratio and yield. There is no guarantee that a Fund will maintain a positive yield.”
According to a Bloomberg news account, the company manages $7.9 billion in money market funds, including about $4.1 billion in the Janus Institutional Money Market Fund
CEO Gary Black said during an analysts’ conference call that the money-fund business required greater scale than its funds achieved. “The fourth quarter, for us and for everybody else, was dead,” Black declared, according to Bloomberg.
Janus will continue to offer retail money-market funds.
The SEC filing is available here.