QUOTE AND NEWS
Benzinga  2 hrs ago  Comment 
The Board of Swedish Orphan Biovitrum AB (OTC: SWTUY) notes the recent speculation in the press and elsewhere regarding a potential acquisition of the company. The Board confirms that it has received a preliminary and conditional non-binding...
Benzinga  2 hrs ago  Comment 
Swedish company SSAB AB reported a net profit for the first quarter. The company posted a quarterly net profit of 284 million Swedish kronor ($33 million), versus a year-ago net loss of SEK50 million. Its revenue gained to SEK15.47 billion...
Reuters  11 hrs ago  Comment 
Swedish Orphan Biovitrum, which specializes in selling medicines for rare diseases, said it had received a preliminary proposal for a bid on the firm, the latest company to be...
The Hindu Business Line  Apr 23  Comment 
More than 5,800 public drinking water sources have been notified in the Dakshina Kannada district. Addressing presspersons in Mangaluru, AB Ibrahim, Deputy Commissioner of Dakshina Kannad...
Benzinga  Apr 21  Comment 
Swedish company BillerudKorsnas AB reported a gain in its profit for the first quarter. The company's quarterly net profit climbed to SEK492 million, versus a profit of SEK361 million. Its sales rose to SEK5.63 billion from SEK5.41...
Benzinga  Apr 21  Comment 
TELE2 AB ADR (OTC: TLTZY) reported a rise in its net profit for the first quarter. Its revenue rose 6 percent to SEK6.51 billion ($747 million), while earnings before interest, taxes, depreciation, and amortization jumped 5 percent...
BBC News  Apr 21  Comment 
Discount clothing chain Primark reports another rise in sales, but profits at owner AB Foods fall after losses at its sugar business.
Clusterstock  Apr 21  Comment 
People across the world are going crazy for ultra cheap fashion at Primark, where you can buy clothing items for as little as £1. It's popularity is growing so much that it essentially saved its parent company Associated British Foods from...




 

AllianceBernstein L.P. (NYSE: AB) is an asset management firm with over $480 billion in assets under management (AUM). Over 97% of AB's investments are in stocks and bonds.

The world's second largest insurance company AXA (headquartered in France) owns over 60% stake of AB.[1] The company's foreign ownership lets it avoid the 35% federal corporate tax, and instead pay minimal dues of 7.5% for an unincorpated business. However, AB's partnership status also means that it must distribute nearly all of its earnings to its fund holders, limiting the growth potential of the firm.

More than half of AB's AUM is invested abroad, and the international focus of the company helped to shield the company from the 2007 credit crunch.

Corporate Overview

Business Financials

In 2009, AB posted total revenues of $2.94 billion, a slight decrease from its 2008 total revenues of $3.57 billion. As a result of the decrease in revenues, AB's net income was adversely affected. Between 2008 and 2009, AB's net income declined from $244.7 million in 2008 to $167 million in 2009.

Business Segments

AB's AUM and revenue fall under the following categories:

Institutional Investment Services (60.5% of 2009 AUM)[2]

Institutional Investment Services refer to products and services provided for corporate or governmental investors using diversified investments into instruments like hedge funds, mutual funds, and investment trusts. At the end of 2009, total AUM for this segment was $300 billion.[2]

Retail Services (24.4% of 2009 AUM)[2]

Retail Services are designed for the individual investor as their funds are spread among a variety of investment vehicles like those of AB's Institutional Investment Services. Such vehicles include mutual funds and closed end funds, which offer a set number of shares for its funds. At the end of 2009, this segment had total AUM of $120.7 billion.[2]

Private Client Services (15.1% of 2009 AUM)

This segment includes AB's investment interactions with private clients. At the end of 2009, this segment had total AUM of $74.8 billion.[2]

Key Trends and Forces

Strong international exposure boosts AB business

AllianceBernstein is still largely an American firm, as 60% of its clients live in the U.S.[3] However, both individual and institutional business are becoming more and more international. In fact, the company invested 40% ($320 billion)[4] of their AUM overseas and 61% of their investment services ($489 billion)[3] were for clients (mainly institutional) outside the US. International markets are providing key business for AB, especially as the firm pushes through the 2007 credit crunch.

Competition

AllianceBernstein competes with many firms throughout the greater financial services industry. Some of its direct competitors include BlackRock (BLK), Legg Mason (LM), Eaton Vance (EV), and T. Rowe Price Group (TROW).

References

  1. AB 2007 10-K pg. 18  
  2. 2.0 2.1 2.2 2.3 2.4 AB 10-K 2009 Item 1 Pg. 6
  3. 3.0 3.1 AB 2007 10-K pg. 3-4  
  4. 2008 AB Conference Call
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