Legg Mason CEO To Quit

Sep 12 2012 | 11:28am ET

Asset management giant Legg Mason's CEO has quit in advance of a potential new round of hostilities with activist hedge fund Trian Fund Management.

Mark Fetting, who took over from firm founder Raymond Mason almost five years ago, will step down as chairman and CEO on Oct. 1. Two months later, a standstill agreement with Trian expires, allowing the hedge fund to once again to build up its stake in Legg and ending a prohibition on attempts to force a sale or merger of Legg's nine affiliates, which include fund of hedge funds manager Permal Group.

As part of that agreement, struck during Fetting's second year at the helm, Trian chief Nelson Peltz joined the Baltimore-based firm's board of directors.

Legg said that head of global distribution Joseph Sullivan would become interim CEO and independent director W. Allen Reed non-executive chairman.

Fetting's tenure has been marked by a swooning share price, precipitous client withdrawals and job cuts.

Trian is Legg's largest shareholder, with a stake of about 10%.

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