Transition Manager Planning Its Own Transition

July 31, 2002 ( - One of the industry's leading transition management consultants is said to be in the middle of acquisition talks.

The Plexus Group, which by dint of longevity and persistence, has established itself as the leading execution measurement consultant, specifically in the fast growing area of manager transitions, is in the midst of acquisition talks, according to sources.

Reached in his Los Angeles office, however, Plexus president David Hall would only volunteer that “there is no story here.” The purported acquirer is JP Morgan Chase, which likewise would not confirm that it is in negotiations with Plexus.

Plexus’ role in consulting on transitions is a powerful one, and its acquisition can only make the product offering at JP Morgan Investor Services more robust.  Plexus, headed by Wayne Wagner, has until now tended to be hired directly by plan sponsors – including the likes of Texas Permanent Fund and Florida’s State Board of Administration – to monitor transitions.

Historically, when a manager was terminated, those holdings were sold and cash was given to a new manager to build up its portfolio – a strategy that experts say could cost a plan up to 5% of the value of the portfolio. By contrast, manager transitions not only lower trading costs, they can eliminate the risk of market timing by keeping the plan invested and out of cash, and they can minimize the operational costs that are part and parcel of large portfolio shifts.

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