These days, the mutual fund industry is starting to resemble a teen horror flick, with some funds hooking up with seeming abandon while others disappear, leaving shock and scandal in their wake.

The latest round of news comes from the $1 billion

Waddell & Reed Financial

(WDR) - Get Report

, which announced it will acquire the majority of Ivy Funds into its W&R family. The move will create a new 18-fund family that will be marketed under the Ivy brand.

Waddell & Reed will merge six Ivy funds into its own; six Ivy funds will remain as they are, but under the W&R umbrella; and all W&R funds, including those not merging with Ivy funds, will operate under the Ivy name. Roughly $479 million of Ivy Funds' $648 million in assets (as of Dec. 31, 2002) will be merged into the new combined Ivy and W&R fund family; the remaining $168 million (two Ivy funds) will be merged into the Waddell & Reed Advisors Funds family, which will keep its name.

"I don't think Waddell & Reed shareholders have anything to be concerned about; they're just expanding their product line," says Morningstar analyst Dan McNeela. "W&R had a slate of domestic equity funds that were concentrated in large stocks; they could stand to round out."

Shareholders in the six Ivy funds that are being merged into W&R funds should ensure that the investment still meets their objectives.

All merged and renamed funds will carry the W&R performance history. After the mergers, scheduled for June 2003, the Ivy funds will continue to be sold through intermediary channels, as well as through Waddell & Reed's network of proprietary financial advisers.

Another Three Bite the Dust

The absurdly aggressive Van Wagoner fund family has spurned investors repeatedly since crashing nearly three years ago. In an odd decision to add insult to injury,

in November the firm decided to charge an "account servicing fee" on accounts that dipped below $2,500 -- a figure well above the previous minimum investment of $1,000. (At the same time, the company upped its minimum initial investment to $5,000.)

Now, though, the investors that have hung in there, expecting that speculative technology stocks will have their day once again, are out of luck. Rather, even


out of luck than they already were.

Van Wagoner is liquidating three of its five funds --


Van Wagoner Post-Venture,


Van Wagoner Mid-Cap Growth and


Van Wagoner Technology. The liquidations were effective Monday, March 3.

Not that there was much left to liquidate -- the combined asset base for these funds had fallen from some $1.6 billion in the spring of 2000 to today's $115 million, according to Morningstar. Clearly, the heavy losses these funds suffered, compounded by massive redemptions, left such a small asset base that they weren't profitable to run -- even given Van Wagoner's above-average expense ratio.

Ready for more good news? In a separate March 3 filing, Van Wagoner admitted that the

Securities and Exchange Commission

began investigating in September 2002 the fund family's pricing practices regarding its private placements. At issue is whether Van Wagoner inflated the value of its private holdings, which would be in violation of federal securities laws.

Next Up: Transamerica

The $90 million Janus Capital Appreciation has just merged with the $30 million


IDEX Transamerica Growth Opportunities fund. Both portfolios had previously been subadvised for the IDEX mutual funds.

The fund, which focuses on small- to mid-sized companies, will continue to be managed by Chris Bonavico and Ken Broad.