Wells Fargo Said to Be Key Bidder for Strong

Wells Fargo & Co. has emerged as the favorite bidder for mutual fund firm Strong Financial Corp., which is likely to fetch less than $500 million, sources familiar with the company’s sale say.

“My information is the Wells deal is back on track,” said one source close to the negotiations. “But we’ve not seen anything close to definitive.”

San Francisco-based Wells Fargo is one of the nation’s largest banks and a major provider of mutual funds and other investment services.

Nuveen Investments Inc., an asset manager known mostly for its municipal bond funds, is the other bidder still in the running, another source said. A sale is still weeks away, the two sources said.

A spokeswoman for Menomonee Falls, Wis.-based Strong declined to comment. Representatives for Wells Fargo and Nuveen also declined to comment.

Investment bank Goldman Sachs Group Inc. was hired in December to sell Strong, whose founder and primary shareholder, Richard Strong, resigned last year after he was accused of improper trading in the firm’s funds. He has not been charged.

The company, which manages about $38 billion, was one of the first fund operators to be named in the scandals that have rocked the industry since New York Atty. Gen. Eliot Spitzer unveiled an investigation into industry practices in September.

Wells Fargo has sought assurances that leading portfolio managers at Strong would stay with the company after its sale, one of the sources said.