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Janus investment chief Craig quits to manage new family foundation

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DENVER — Janus Capital Corp.'s chief investment officer Jim Craig resigned to manage a family foundation he is establishing, ending his 17-year tenure at what's been the fastest-growing mutual fund company.

A committee formed by last year by Craig, who was also research chief, will oversee Janus's investments. The panel included fund managers Jim Goff, Warren Lammert, Blaine Rollins, Scott Schoelzel, Helen Young Hayes and chief executive Thomas Bailey.

The departure of Craig, who had been Bailey's designated successor, comes eight months after he quit managing the Janus Fund and a month after the company was spun off as part of Stilwell Financial Inc. from Kansas City Southern Industries Inc. Janus opposed it, looking for independence.

Speaking by telephone from his office Wednesday morning, Craig said his new venture had been in the works for while. 'When I gave up the Janus Fund, people who know me well knew that it was the beginning of a process," he said, adding that the Stilwell spinoff "had no effect at all on the decision."

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Stilwell shares slid 3 7/8 to 44 1/8 in midmorning trading, as Craig's departure prompted concern the firm may not be able to maintain its growth rate if a slump in fast-growing technology and telecommunications companies trims the funds' performance.

"Their market share gains will slow because of relative performance," said Chris Perras, a portfolio manager at AIM Management Group Inc., which holds Stilwell and Kansas City Southern shares.

Stilwell, which also includes asset managers Berger LLC, Nelson Money Managers Plc and a stake in DST Systems Inc., had assets under management of $313 billion at the end of June, compared with $161.3 billion a year ago. Assets slid from the first quarter's $324.9 billion, reflecting a drop in U.S. stocks.

Denver-base Janus, the best-selling mutual fund manager this year, accounted for $17.5 billion of the record $17.6 billion in new net assets that Stilwell amassed in the second quarter.

Craig assumed the post of research director after stepping down as manager of Janus' $47 billion flagship. Craig relinquished control of the fund at the end of December, after having managed it since 1987, when it had $377 million in assets. The move was aimed at beefing up the firm's management after a decade of rapid growth. Craig joined Janus in 1983.