Legg Mason has cut 120 jobs amid pressure to reduce costs and ramp up growth, according to an internal memo obtained by Citywire USA.
According to a spokeswoman for the firm, about 12% of Legg Mason's 1,000 corporate employees across its global offices have been affected, with the majority of lay-offs occurring in the US and a smaller number in Europe and Asia.
The spokeswoman also confirmed that activist investors Nelson Peltz and Ed Garden from Trian Fund Management joined the board earlier this week. Legg Mason was reportedly in talks with Trian chief executive Peltz to provide the hedge fund with three or four seats on its board to avoid a proxy fight.
‘Today’s staff reductions reflect the necessity, in this evolving industry, to rethink how we deliver on our mission of investing to improve the lives of our clients and other stakeholders,’ Legg Mason chief executive Joe Sullivan said in the memo to staff on Thursday.
No investment management personnel or affiliate business roles have been affected and all of the redundancies were from corporate roles.
‘I would first like to thank our colleagues who are or will be leaving Legg Mason for their years of service to our clients and to our firm,’ Sullivan added.
In addition to the job cuts, the Baltimore-based asset manager has restructured its corporate leadership in a variety of capacities, with head of affiliate relations John Kenney, as well as marketing and product heads Fran Cashman and Tom Hoops, set to depart at the end of the year.
Head of global sales and distribution Terry Johnson will be assuming responsibility for global marketing and product upon Hoops’ and Cashman’s departures.
The new executive committee reporting to Sullivan is now made up of four members, including Johnson. Patty Lattin will oversee human resources and facilities, Tom Merchant will serve as general counsel, head of risk management, and chief financial officer Pete Nachtwey will now be responsible for affiliate relations. Chief administrative officer Ursula Schliessler will leave the firm, along with former executives Kenney, Cashman and Hoops.
‘Today is a very difficult day. Each of us has been impacted in some way by the actions we are taking, and I would ask that we support each other as we go forward especially those that are departing,’ said Sullivan.
In February, Legg Mason said it planned to cut jobs during the year to reduce costs, with about $100 million (£89.6 million) in anticipated cost savings.
Legg Mason is the latest firm to announce redundancies, amid continued outflows from active funds and market volatility at the end of 2018.
At the end of March, Citywire reported that JP Morgan was cutting hundreds of jobs in asset and wealth management, and in January, BlackRock said it was to cut 500 jobs. State Street also said it would axe 1,500 jobs, including 15% of senior managers.
Invesco is another firm that has been in the process of cutting jobs ahead of its anticipated acquisition of OppenheimerFunds, while AllianceBernstein continues to make lay-offs as part of its relocation to Nashville, Tennessee.