Legg Mason has settled on a $115 million price tag for Royce & Associates. Legg Mason may elect to pay for up to half of the amount in common stock. The deal was initially reported by the Wall Street Journal on June 14th. At the time Legg Mason was reportedly looking to pay between $80 and $200 million for Royce.



Nine months after its merger, ABN AMRO is folding three funds into their Alleghany Asset Management counterparts, reports Morningstar.com. Pending shareholder approval, the following funds will be collapsed: the $202 million ABN AMRO Fixed Income Fund will be folded into the $138 million Alleghany/Chicago Trust Bond Fund, the $69 million ABN AMRO Balanced will jump into the britches of the $290 million Alleghany Balanced Fund, and the $23 million ABN AMRO Tax-Exempt Fixed Income will join $22 million Alleghany/Chicago Trust Municipal's party.



Morningstar Japan KK, a joint venture between Softbank Finance Corp and Morningstar, announced that operating profit for the six-month period between January and June rose 54 percent thanks to growth in investment education and consulting, reports Reuters.



In response to growing popularity, Fifth Third Bank Investment Advisors is launching Investment Managed Accounts. Investors can choose among the following investment styles: "consistent quality growth or growth/value blend" for stock accounts and taxable or tax-exempt accounts for bond accounts. Fifth Third will launch an additional "pure disciplined value" styled account in the near future.



The Schwab Center for Investment Research found in a study entitled "Index or Actively Managed Equity Mutual Funds: Which Way To Go In A Down Market" that large cap index funds outperformed actively managed large cap stock funds 55 percent of the time in the past 20 market declines between December of 1986 through March of 2001. Other findings include that when index funds beat actively managed funds the margin was only .58 percent while the margin when active funds beat index funds was 1.64 percent.



As was reported previously, Merrill Lynch is disbanding its L.A. investment management office formed in 1996 from the acquisition of Hotchkis and Wiley. Merrill Lynch has been trying to sell the $10 billion business to Stilwell Financial, reports the July issue of Institutional Investor. However, the key departures of Sarah Ketterer, the daughter of founder John Hotchkis, who is leaving to form her own firm, Causeway Capital Management, and Harry Hartford, who together managed the $3.2 billion Mercury HW International Value Fund raises serious doubts about the firm's prospects. Institutional Investor also reports that Ketterer and Hartford were without contracts at the time of their departure. Ketterer is supposedly trying to smooth out her departure in an effort to avoid litigation from Merrill. In an interesting case of déjà vu, a cohort of employees that left Hotchkis and Wiley to form Metropolitan West Asset Management before the acquisition by Merrill was sealed was consequently sued by Hotchkis and Wiley under the direction of their puppet master, Merrill Lynch. 

Stay ahead of the news ... Sign up for our email alerts now
CLICK HERE