BOSTON - Fleet Asset Management, whose deal to acquire Liberty Asset Management is set to close Nov. 1, is looking to reinvent itself, combining its many moving parts into one organization and considering a new moniker.
"It will be an integrated organization," said Fleet Asset Chief Executive Officer Keith Banks, operating separately from its parent company, FleetBoston Financial. "We're not a bank," Mr. Banks said, "we're an autonomous asset management company." To that end, Fleet is considering a new name for the asset management arm.
There's a good chance it won't be Fleet, the name selected last year before the Liberty deal took place, said Mr. Banks. The firm is working on branding issues, he added, looking for a name that properly conveys a "world-class asset management business."
The group comprises Fleet, Columbia Management Co., Portland, Ore., Liberty Asset Management Co., Boston, and its six investment subsidiaries: Colonial Management Associates, Boston; Crabbe Huson Group Inc., Portland, Ore.; Progress Investment Management Co., San Francisco; Stein Roe & Farnham, Chicago; Newport Pacific Management Inc., San Francisco; and Liberty Wanger Asset Management, Chicago.
While the overall asset management company may undergo an identity change, Mr. Banks said, it intends to preserve the brand identities of the various units, including keeping the Liberty name for its mutual fund operation. He said Fleet Asset plans to "preserve the autonomy" and the "boutique-like" investment culture of the subsidiaries while providing them with resources. "We have to be configured so we get the benefits of scale. Scale is important, if used intelligently," he said.
Fleet also plans to build out some new investment areas, including enhanced indexing. Earlier this year, the firm hired Roger Sayler, formerly CEO of Vantage Investment Advisors, New York, as managing director to head up this effort, and it is looking to hire staff.
It also would like to start a hedge fund and fund-of-funds structure, possibly in partnership with a manager that has those capabilities. "We want to be a lot of things to a lot of people," said Mr. Banks. He sees the asset management business continuing to bifurcate, with the major players on one end and the boutiques on the other end. "Firms in between are in an untenable place," he said, and the goal for Fleet is to grow and be a major player. "We want to be a top 20 asset management company," he said. "We feel we're on the right track."
The units will be integrated on three fronts, said Mr. Banks: distribution, research and operations. The research staff of will be centralized, with 18 analysts working in New York and Boston. Operations and support services will be linked and integrated to eliminate duplication of services.
Mutual fund distribution will be handled out of Boston through Liberty Funds Distributors, while institutional distribution and marketing for the subsidiaries will be run by a new unit headed up by Robert Birnbaum, who joined Fleet earlier this year; he had been a managing director at Credit Suisse Asset Management, New York, where he ran the defined contribution group. Previously, institutional marketing and distribution was scattered throughout Fleet, Liberty and Columbia.
The firm also may merge portfolios that overlap. "We're trying to make 1 plus 1 equal something north of 2," said Mr. Banks. Company executives haven't determined which portfolios will be merged or how many layoffs would be necessary, he said, but he expects announcements to be made in November.
He added that teams, made up of members from across the units, have been established to look at each piece of the business. The teams will determine where there is redundancy and employee overlap, and make recommendations to a steering committee about consolidating. "Over the course of the next couple of weeks, these decisions will be made," he said.
Mr. Banks said while there are cost savings associated with integration, that isn't why the firm is doing it. "You want to create an optimal structure," he said.
Some divisions will specialize in one area, like institutional asset management or mutual funds, while others may specialize in more than one marketplace.
Liberty brought to Fleet $50 billion in assets under management and a wider range of investment capabilities. Fleet has $173 billion in assets, of which $67 billion is for institutional investors, making Fleet the 25th largest manager of institutional assets in the United States. The asset mix is approximately 50% equity, 30% fixed income and 20% money market funds.