The London operations of PanAgora Asset Management has shed its investment research and management capabilities to become purely a marketing operation for the Boston-based asset manager.

The active quant manager came to London in 1989 and had built up a team of over 25 which will shrink to four or five. London managing director Colin McLatchie left at the end of last month.

The company had only $137m of European pension assets under management mid-1997, according to the 'Mercer European Pension Fund Manager Guide', but had won a number of mandates since then.

Product will come through a pipeline from Boston", says an observer.

Earlier this year, the company made a determined assault on the UK pensions market in a new structured balanced product with a two-year track record.

PanAgora,which has over $17bn in group assets under management, intends to continue serving the UK institutional market. It has not given a reason for the restructuring in London, though it follows the recent 50% stake acquired by the huge US Putnam group in PanAgora .

p The joint venture between PanAgora and the giant German banking group DG in Frankfurt to enter the Spezialfonds market has been unaffected by the London move.

According to a spokesperson, formal approval for the joint investment company is expected shortly. It has built up a team of 14, including the investment personnel required under German law. "They are waiting for the starting pistol to go off as we believe there is a market for the PanAgora product and strong interest in the Anglo Saxon approach." Fennell Betson"