Is your investment in Mutual Funds of DSP Merill Lynch safe ?

On Sept 14th 2008, Bank of America’s announced a planned acquisition of $50 billion. According to a Reuters report, this acquisition would combine the largest U.S. consumer bank with one of the largest U.S. investment banks and the leading retail brokerage force.

But as a result of this, the investors in India are worried about the future of their investments in DSP Merill Funds. Is it safe ?. Will it vanish overnight just like Merill Lynch ?. This article focuses on answering the same

The change in ownership of Merill Lynch has a bearing on the ownership of the asset management company. But investors in the DSP Merrill Lynch fund should not worry till their money is managed efficiently by the same set of people who were managing it earlier. The regulatory framework for mutual funds in India ensures safety of your investment managed by any asset management company.

In 2006, the asset management business of Merrill Lynch (Merrill Lynch Investment Managers) was combined with BlackRock. BlackRock is one of the largest listed asset management companies in the world managing assets in excess of $1.4 trillion.
In line with the realignment of Merrill Lynch's asset management business globally, the 40% stake held by DSP Merrill Lynch Limited in DSP Merrill Lynch Fund Managers Limited, would be transferred to BlackRock. The balance 60% will continue to be held by the DSP Group, through its investment companies.

The Board of Directors of DSP Merrill Lynch Fund Managers Limited has approved this transfer and only regulatory approvals are being awaited. The AMC anticipates the regulatory process to be completed shortly. Consequent to the transfer, DSP Merrill Lynch Fund Managers Limited will be renamed "DSP BlackRock Investment Managers Limited" while DSP Merrill Lynch Mutual Fund will be renamed "DSP BlackRock Mutual Fund ".

Thus the the asset management business of Merrill Lynch was combined with BlackRock way back in 2006. Even if Bank of America did not take over Merill Lynch worldwide, the change in "DSP Merrill Lynch Mutual Fund" to be renamed "DSP BlackRock Mutual Fund" was a foregone conclusion.