The upcoming combination of Morgan Stanley and Smith Barneys wealth management groups has claimed its first high-level victim: Ellyn McColgan.
Recruited from Boston-based Fidelity Investments a year ago to run Morgan Stanleys sprawling retail brokerage group, Ms. McColgan is leaving at the end of the month, according to a memo sent to employees by Morgan Stanley chief executive John Mack and James Gorman, the New York based-banks co-president.
At Fidelity, Ms. McColgan, a 17-year veteran of the Boston-based firm, was named chief of distribution and operations in early 2007, a move that observers at the time said put her on a fast track to replace Edward "Ned" Johnson, Fidelity's chairman. But shortly after the firm tapped Rodger A. Lawson to oversee the non-investment side of Fidelity's operations in July 2007, she decided to leave. When she took over distribution, she continued to run the mutual fund giant's sprawling brokerage operation.
Mr. Gorman this month announced a deal to pay $2.1 billion to Citigroup Inc., the parent of Smith Barney, for a 51% stake in a joint venture that will create the biggest broker-dealer by number of brokers. Mr. Gorman said he and Smith Barney president Charlie Johnston will run the unit.
"Ellyn has provided strong leadership during one of the more tumultuous periods our industry has ever seen," Mr. Mack and Mr. Gorman wrote in the memo, obtained by InvestmentNews. "Now, with the planning for the new Morgan Stanley-Smith Barney joint venture under way, Ellyn has decided to explore other leadership opportunities in the industry, and we respect this decision."
A Morgan Stanley spokeswoman said the company had no comment, and that Ms. McColgan was not available to comment.
Jed Horowitz is a reporter with InvestmentNews, a sister publication of Pensions & Investments