Legg Mason

Legg Mason's plan to cut nearly a third of its local work force is a potent example of how much the financial climate has changed in recent years — and a reminder of how painful it is to be on the outs with Wall Street. The Baltimore-based company has gone through the boom and bust. Five years ago in good times, it struck a deal with Citigroup Inc. that turned the regional player into the world's fifth-largest money manager. Then the company slammed into the worldwide financial crisis, and losses and layoffs ensued.

Devotees of Legg Mason Inc.'s annual Thanksgiving List of stock picks clearly have one thing to be thankful for this year: that last year's list ended up in the black.After a tough year on Wall Street, the Baltimore investment firm's 1993 offering of a dozen stocks managed a respectable 4.4 percent gain, compared with a 3.0 percent increase from the Standard & Poor's 500 stock index, Legg Mason announced yesterday.Both returns assume dividends were reinvested in the stocks, and neither includes commissions.

Legg Mason Inc. reported Friday a $453.9 million loss for the third quarter, following a previously announced $734 million writedown of certain assets. On a per-share basis, the Baltimore-based money manager lost $3.45. For the corresponding quarter a year ago, the company earned $28.1 million or 20 cents per share. Legg, which has been operating without a permanent CEO for four months, continued to see investor dollars flow out of its funds in the quarter ended Dec. 31. The stock fell more than 3 percent Friday, closing at $26.79 per share, down 86 cents.

Baltimore money manager Legg Mason reported Friday its net income for the fiscal third quarter fell 54 percent as the company saw assets under management fall. Net income for the three months ending Dec. 31 was $28.1 million, or 20 cents per share, compared with $61.6 million, or 41 cents per share. Assets under management declined 7 percent to $627 billion, from $671.8 billion a year ago. Revenues were $627 million in the fiscal third quarter, down from $721.9 million a year earlier.

Baltimore-based Legg Mason Inc. announced Thursday morning it has agreed to acquire Fauchier Partners, a manager of funds of hedge funds based in Europe. The terms of the deal were not disclosed. Fauchier will be merged into Legg's subsidiary Permal, an alternative asset manager. As a result of the combination, Permal will have about $24 billion assets under management and offices in nine locations worldwide, Legg Mason said. The deal is expected to close in the first quarter of next year.

Legg Mason Inc. said Monday that it would lay off an additional 35 workers by January as part of a previously announced plan to shut down the money manager'sOwings Mills facility. In a notice Monday to the state's Department of Labor, Licensing and Regulation, the company said the 35 employees, all of whom work at the company's Baltimore County offices on Red Run Boulevard, would be laid off between Oct. 1 and January. The cuts are part of the company's plan to streamline its technology group and outsource some of its work, said Mary Athridge, a company spokeswoman.

Money manager Legg Mason Inc. said Monday that it will cut 250 jobs in the Baltimore area — 30 percent of its local work force — in an effort to boost profits by shipping the work to affiliates around the world. Most of the layoffs will be achieved by shutting down the company's Owings Mills offices, with the rest of the job cuts at its brand-new building on the city's waterfront in Harbor East. The move will bring the company's Baltimore-area employment to about 550 — a drastic drop from just two years ago, when nearly 1,000 people worked here.

Legg Mason Inc.'s stock retreated Friday, a day after shares shot up on a report that the company's board rejected — at least for now — a proposal by senior managers at its affiliates and private equity investors to take the company private. The Baltimore-based money manager's stock rose by more than 3 percent Thursday, but Friday the stock dropped 32 cents to close at $26.52 per share. The decline was driven largely by newly released figures Friday showing that money continued to flow out of Legg funds in the last quarter, said Jeffrey Hopson, a senior analyst with Stifel, Nicolaus & Co. in St. Louis.

New York investor Nelson Peltz has acquired a bigger share of Baltimore-based Legg Mason Inc., buying 2.65 million shares of the Baltimore money manager for $76.5 million between Aug. 1 and Aug. 3, a Securities and Exchange Commission filing shows. The Baltimore Business Journal first reported the news. Peltz's New York-based Trian Fund Management LP is the company's biggest shareholder, with 13.9 million shares, or 9.4 percent, after this week's purchases. Peltz, a Legg Mason director, began buying shares in 2009.

Legg Mason Inc. said it agreed to pay $80 million for European fund manager Fauchier Partners, plus as much as an additional $56 million in the next four years if certain financial targets are achieved. Though Legg announced in December its plan to acquire Fauchier from BNP Paribas Investment Partners, the Baltimore-based money manager only disclosed the terms of the deal in a regulatory filing Wednesday. Once the acquisition is completed in the current quarter, Fauchier will be merged into Legg's Permal Group affiliate in New York.