The Janus Henderson Group CDI (ASX: JHG) share price has come under pressure and is sinking lower today.
In morning trade, the fund manager's shares are down 7% to $39.66.
Why is the Janus Henderson share price sinking?
Investors have been selling the company's shares this morning following the release of its fourth quarter update last night.
According to the release, Janus Henderson achieved fourth quarter operating income of US$227 million. This was up 45% on the third quarter and 47.1% on the prior corresponding period.
Management advised that the increase in operating income was primarily due to higher average assets under management (AUM), seasonal performance fees, and improved investment gains compared to the prior quarter.
In respect to its AUM, Janus Henderson's AUM increased 12% to US$401.6 billion compared to the prior quarter. This reflects positive markets and improved outflows of US$1.1 billion.
Dai-ichi Life sells stake
Overshadowing this strong profit growth was news that one of its major shareholders is selling its stake.
The release explains that Dai-ichi Life intends to exit its equity investment in Janus Henderson to focus capital on its global insurance business. Dai-ichi will be offloading 30,668,922 shares and relinquishing its board seat.
However, the two companies intend to work closely together for the foreseeable future.
Seiji Inagaki, President of Dai-ichi Life, commented: "Our relationship with Janus Henderson has benefited both our organizations over the last eight years, and we are pleased that our partnership will continue, even as we strategically reallocate capital investments."
"Janus Henderson remains a powerful franchise in the global Asset Management market and we hold their teams in high regard. Janus Henderson has been a great partner for the past 8 years. We are confident in Janus Henderson's quality and leadership and look forward to continuing our strategic relationship with the firm going forward," he added.
Janus Henderson's CEO, Dick Well, echoed this sentiment.
Mr Well saidi: "We look forward to continuing the strong relationship with Dai-ichi through the new co-operation agreement, building on eight years of trust. Although we are disappointed to lose Dai-ichi as a shareholder, today's news does not change the path that Janus Henderson is on to deliver Simple Excellence across our business. We remain committed to delivering strong risk-adjusted returns for all of our clients and long-term value and profit growth for all of our shareholders."
