Franklin Templeton acquiring Legg Mason and affiliates

Franklin Resources Inc., operating as Franklin Templeton, is acquiring investment management company Legg Mason Inc.

The all-cash deal priced Legg Mason’s common shares at US$50. As part of the transaction, Franklin Templeton will assume the manager’s outstanding debt of about US$2 billion. Legg Mason and its multiple affiliates collectively manage about $806 billion, including Brandywine Global, Clarion Partners, ClearBridge Investments, Martin Currie, QS Investors, Royce Investment Partners and Western Asset.

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“This is a landmark acquisition for our organization that unlocks substantial value and growth opportunities driven by greater scale, diversity and balance across investment strategies, distribution channels and geographies,” said Greg Johnson, executive chairman of the board of Franklin Resources, in a press release. “Our complementary strengths will enhance our strategic positioning and long-term growth potential, while also delivering on our goal of creating a more balanced and diversified organization that is competitively positioned to serve more clients in more places.”

Following the transaction, Legg Mason’s affiliates will retain their investment autonomy, with their investment philosophies, processes and brands unchanged. The senior management teams will also see no changes.

“By preserving the autonomy of each investment organization, the combination of Legg Mason and Franklin Templeton will quickly leverage our collective strengths, while minimizing the risk of disruption,” said Joseph Sullivan, chairman and chief executive officer of Legg Mason. “Our clients will benefit from a shared vision, strong client-focused cultures, distinct investment capabilities and a broad distribution footprint in this powerful combination.”

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