Pimco names Seidner to run unconstrained bond fund as Parikh exits

First high-profile departure since surprise exit of co-founder Bill Gross

Jan 12, 2015 @ 10:21 pm

By Bloomberg News

Pacific Investment Management Co. named Marc Seidner as lead manager of the Pimco Unconstrained Bond Fund (PUBAX) as Saumil Parikh leaves the firm, the first high-profile departure since the surprise exit of co-founder Bill Gross.

Mr. Seidner will run the fund with Mohsen Fahmi and group Chief Investment Officer Daniel Ivascyn, Newport Beach, Calif.-based Pimco said Monday in a regulatory filing. Mr. Parikh was named a co-manager last year after Mr. Gross left.

“Consistent with industry norms, typically during this time of year, a small number of individuals make decisions to leave the firm, either to pursue opportunities in our industry, or for other reasons,” Pimco Chief Executive Officer Douglas Hodge said in an e-mailed statement. “We thank Saumil for his contribution and wish him success going forward.”

Pimco has faced unprecedented turmoil in the past year, with the departures of ex-CIO Gross and former chief executive officer Mohamed El-Erian. The $1.87 trillion firm had the worst year of withdrawals in the history of fund management in 2014 amid that leadership shakeup and as performance at some strategies faltered. Some managers, including Mr. Seidner, left and then returned to the firm after Mr. Gross's Sept. 26 exit.

Mr. Parikh, who didn't return telephone and e-mail messages seeking comment, is a managing director and a member of the firm's investment committee, according to his biography on the Pimco website. He led the firm's cyclical economic forums. Before joining the firm in 2000, he worked at UBS Group AG, and majored in economics and biology at Grinnell College, according to Pimco's website and his LinkedIn Corp.profile.

UNCONSTRAINED REDEMPTIONS

Last month, Mr. Parikh and Mr. Ivascyn co-wrote the firm's 2015 economic outlook report after its quarterly cyclical forum.

Mr. Gross, who co-founded Pimco in 1971, managed the $11.5 billion Unconstrained fund until the day he left. That fund returned 2.3% in the past year through Jan. 9, outperforming 75% of its peers, according to data from Chicago-based research firm Morningstar Inc. Over five years, that fund has beaten 45% of rivals, the data show. Mr. Gross now manages a competing unconstrained strategy at Denver-based Janus Capital Group Inc.

The Pimco unconstrained fund suffered $15.9 billion in redemptions last year, the second-biggest withdrawals after the firm's Total Return Fund (PTTRX), the world's biggest bond fund, according to Morningstar.

RE-HIRING MANAGERS

Mr. Parikh and Mr. Fahmi also took over the $1.3 billion Pimco StocksPlus Absolute Return Fund (PSPTX), which seeks to beat the S&P 500 Index, after Mr. Gross exited. That fund returned 14% last year, beating 87% of its peers, according to data compiled by Bloomberg. Over five years, the fund has outperformed 96% of its competition.

Mr. Parikh also helped oversee the $4.1 billion Pimco Fundamental IndexPlus AR Fund (PXTIX), which has a similar objective. That fund returned 12% last year, trailing 51% of peers, according to data compiled by Bloomberg.

Mr. Seidner, who left in January 2013 in the wake of Mr. El-Erian's departure, returned in November as CIO of nontraditional strategies, a managing director, and a member of its investment committee. Pimco also brought back Nobel laureate Michael Spence as a consultant and money manager Jeremie Banet as executive vice president in October, as it sought to reassure clients and stem redemptions.

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