Pimco Agrees to Sell Investment Unit to Its Executives

Pimco Advisors Holdings LP said Wednesday that it has agreed to sell its Columbus Circle Investors Inc. unit to the firm’s executives, who had been negotiating for the past few months to pull away from Pimco.

Terms were not disclosed, though Newport Beach-based Pimco said it will share in Columbus Circle’s revenue and will be paid on a quarterly basis “for a period of time.” At the current revenue level, the payments will be about equal to its former share of profits of Columbus Circle, Pimco said.

Columbus Circle, based in Stamford, Conn., invests about $4.5 billion in stocks, mostly for institutional clients. Columbus Circle’s chief executive, Donald Chiboucas, 54, and managing directors Marc Felman, Robert Fehrmann, Clifford Fox and Anthony Rizza had been negotiating a buyout of the firm, which has 40 employees.

Pimco, the third-biggest publicly traded U.S. fund company, with about $248 billion in assets, has been focusing on its two biggest units, Pacific Investment Management Co. and Oppenheimer Capital, and on expanding its mutual fund business.

Columbus Circle was Pimco’s third-biggest affiliate, with about $9 billion in assets, before January, when the parent company moved Columbus Circle’s mutual fund business to a new affiliate, Pimco Equity Advisors.

Columbus Circle Trust Co., a unit of Columbus Circle that manages money for wealthy individuals, will be transferred to Pimco when the transaction is completed by the end of the month, Pimco said.

Pimco shares rose 6 cents Wednesday to $29.88.