BOSTON - BlackRock Inc., the New York-based fixed-income giant, will lay off 31% of State Street Research & Management Co.'s employees when it acquires the firm at the end of January.
Chief Executive Officer and President Richard S. Davis has said he'll stay on after the acquisition of the Boston-based firm closes Jan. 31. Although he declined to be interviewed, Mr. Davis, in an e-mailed response to questions, said he will head up BlackRock's "significant presence in Boston" and looks forward to building its business there.
But sources say all three of the executives who report directly to Mr. Davis - C. Kim Goodwin, SSRM's chief investment officer for equities; Mark A. Marinella, SSRM's chief investment officer for fixed income; and Kevin Wilkins, managing director in charge of distribution of the firm's retail and institutional products - declined the offers that BlackRock extended to them and will move on.
Ms. Goodwin, Messrs. Marinella and Wilkins didn't respond to attempts to contact them. Barbara G. Novick, a BlackRock managing director, declined to comment on specific personnel changes.
Sources say practically all of SSRM's senior marketing and distribution people were let go.
On the fixed-income side, six SSRM structured finance professionals, including Ron D'Vari, the managing director who led the firm's fixed-income research effort, will relocate to New York, said SSRM spokeswoman Robyn S. Tice. She declined to give further details on who would go and who would stay.
The firm's other fixed-income teams — the market-based strategies group led by Brett Wander and the long-duration bond unit headed by Dan Strelow — either weren't offered jobs or opted not to move to New York.
Likewise, many of SSRM's most senior equity portfolio managers weren't tapped by BlackRock to stay on, including Tucker Walsh and Andrew Morey, who managed the SSR Emerging Growth Fund; John T. Wilson, who led SSRM's large-cap core team; and Paul Haagensen, who led the firm's Aurora Fund, said an industry veteran who requested anonymity.
Among the SSRM equity people who will stay on after BlackRock acquires the company are Jeffrey Lindsey, Anthony F. Forcione, Eileen M. Leary, Edward Dowd, Daniel J. Rice III, Linda Zhang and Denis J. Walsh III.
BlackRock is keeping SSR Realty Advisors Inc., Morristown, N.J., intact, and all 175 employees of the equity real estate investment manager were made offers.
Of State Street Research's 371 employees, 116 will get pink slips, the company announced. The company said it expects most employees will be laid off on Jan. 31 "or within 14 days thereafter, and others will be terminated on or prior to April 30, 2005." BlackRock is paying a minimum of $375 million in cash and stock to buy SSRM from MetLife Inc., New York.
Ms. Tice said additional deep cuts are unlikely, although she conceded the final tally could creep higher as those SSRM employees still mulling offers to transfer to BlackRock's New York offices make up their minds.
But with BlackRock officials pointing to SSRM's equity operations as one piece of the acquisition the firm is eager to build on, Ms. Tice said a considerable back-office and operations presence will remain in Boston.