Although Legg Mason established an exclusive sales arrangement for its mutual funds with Citigroup’s Smith Barney brokerage division two years ago when they made their swap, Legg Mason has now renegotiated that in an effort to boost fund sales, the Baltimore Sun reports.
Two years ago, Legg Mason swapped its brokers for Citi’s asset management unit, which made Legg one of the world’s largest asset managers, with more than $1 trillion under management.
Since then, however, some of Legg Mason’s funds have underperformed and flows have sagged, even though the deal gave it access to the large brokerage network of Smith Barney. In the second quarter, clients withdrew $7 billion from Legg Mason’s stock funds.
The new arrangement still gives Smith Barney exclusive rights to the primary shares of Legg Mason funds, but other share classes are now available to a broader market.
“We remain committed to working together to make Legg Mason Capital Management’s world-class investment products available to individual and institutional investors around the world and to help our clients achieve their investment goals,” said Mark R. Fetting, a senior vice president at Legg Mason.