Picks Up Royce & Associates for $115 Million
Legg Mason and Royce & Associates today announced Legg Masons' acquisition of Royce, expected to take place in October. The deal will net Royce $115 million at close, up to half of which may come in the form of common stock, as well as three contingent earnout payments. The value of the deal is capped at $215 million.
At the time of Legg Mason's most recent acquisition, separate accounts manager Private Capital Management, Legg Mason chairman and CEO Raymond (Chip) Mason, said that the firm was looking to increase its managed account business.
'Most importantly, they bring us additional diversification with a top-ranked family of mutual funds,' said Mason. 'The acquisition will also provide us with enhanced exposure to several complementary channels of distribution.'
Under Legg Mason, Royce will operate as a wholly-owned subsidiary with its management structure intact; Legg Mason has secured long-term employment contracts with president, CIO, and portfolio manager Charles (Chuck) Royce as well as other principals. New York-based Royce has 57 employees.