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T. Rowe Price Group to acquire high yield fixed income fund

T. Rowe Price Group Inc. said Monday it will acquire a high yield fixed income fund from Henderson Global Investors (North America) Inc.

The Baltimore-based money manager expects to finalize its acquisition of the Henderson High Yield Opportunities Fund in late May, pending approval by shareholders. T. Rowe plans to reorganize the fund into a new mutual fund, called the T. Rowe Price U.S. High Yield Fund.

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The new fund will expand T. Rowe's high yield investment options. The T. Rowe Price Global High Yield strategy, which had $29.4 billion in assets at the end of 2016, has been closed to new investors since 2012.

"Client demand for high yield strategies remains strong, so this acquisition provides an additional high yield investment opportunity for our clients, while further strengthening our global fixed income franchise," said Ted Wiese, head of fixed income for T. Rowe, in a statement. "In acquiring the Henderson fund, we are also gaining a strategy with an exceptional performance record that has been managed by the same portfolio management team since its inception."

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The Henderson fund is led by Kevin Loome, a former T. Rowe portfolio manager and analyst who will rejoin the firm to manage the new fund. Loome's team, four analysts and a trader, will also join T. Rowe.

The new fund will have an investment program similar to the existing Henderson fund, which focuses on U.S. high yield bonds, and will maintain separate research and trading from T. Rowe. The fund's management team is based in Philadelphia and is expected to remain there following the acquisition.

Henderson Global Investors (North America) is a subsidiary of Henderson Global Investors Inc. in London. The investment management firm has U.S. offices in Boston and Chicago, in addition to Philadelphia.

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