[THE INVESTOR] Samsung Active Asset Management said on July 13 it has postponed a planned merger with Franklin Templeton Investments’ Seoul business. 

The active domestic equity arm of the Samsung entity did not specify the reasons, but industry watchers say the delay is due to Franklin Templeton’s bank-loan fund that suffered losses when one of the portfolio firms defaulted in October last year. 

Franklin Templeton was criticized for disclosing the information to investors only recently, with the Financial Supervisory Service planning to investigate the incident. 

Samsung officials said the firm is not scrapping the deal completely, but temporarily putting it off to a later date. 

Earlier in March, the two fund operators decided to merge and form a joint venture Samsung Franklin Templeton. The firms had set a target date of August 1, with plans to obtain approval from the Financial Services Commission this month. 

Samsung Active was spun off from industry leader Samsung Asset Management last January to focus on active stock fund management. The marriage with the local arm of US-based Franklin Templeton, which was established in 1988, could bring the assets under management to 12 trillion won (US$10.67 billion).

By Ahn Sung-mi (sahn@heraldcorp.com)