PITTSBURGH — Mellon Financial executives have rejected suggestions they are under enormous pressure to do a Legg Mason-Citigroup-style deal, and analysts agree that action the firm already has taken this year should buy it time to focus on its huge asset management operations.
In an Aug. 29 memo to employees, Mellon Chairman and CEO Marty McGuinn disputed a suggestion in that morning's Wall Street Journal that shareholder unhappiness with Mellon's business and share price performance was prompting the firm to reach out to a number of potential merger and acquisition partners.
Mr. McGuinn did not take issue, however, with the column's assertion that Pittsburgh-based Mellon had held talks with Merrill Lynch & Co, State Street Corp. and Northern Trust Corp., among others. Representatives for those companies declined to comment.
Investment bankers and analysts said such talks shouldn't be overplayed. "Every big company, every CEO, is making the rounds, trying to figure out how to better construct their businesses," said the New York-based head of the asset management practice for one investment bank, who declined to be named.
Mellon is the 12th largest money manager in the world, with $707.1 billion in worldwide assets under management at the end of 2004. It is the fourth largest manager of worldwide institutional assets, with $551.2 billion. It also is the fifth largest custody bank.