Terms of the deal were not disclosed.
The transaction will bring Mr. Miller's ownership of LMM to 100% from 50%, said Legg Mason spokeswoman Mary Athridge.
LMM was established as a separate entity in 1999 to invest for the Legg Mason Investment Opportunity Trust Fund.
LMM provides investment management services to Legg Mason Opportunity Trust, Miller Income Opportunity Trust and related strategies with a total of $1.8 billion in assets under management. There will be no changes to the investment team or portfolio management responsibilities as a result of the deal.
“This transaction affirms my ongoing commitment to managing our funds and to our investors,” Mr. Miller said in a news release announcing the deal. “Our team is dedicated to our long-term, value-driven approach and to true active management.”
Mr. Miller was formerly chairman and CIO of Legg Mason Capital Management, formerly a stand-alone affiliate of Legg Mason and now a part of Legg Mason affiliate ClearBridge Investments. He used to manage the Legg Mason Capital Management Value fund, which outperformed the S&P 500 index for 15 straight years before Mr. Miller stepped down from managing the fund in 2012 to join LMM.
Joseph A. Sullivan, chairman and CEO of Legg Mason, said in the news release: “Bill has been an important part of the growth and success of Legg Mason over the years. Today's announcement is consistent with Legg Mason's strategy of focusing on our nine diverse managers with size and scale that can be leveraged across global distribution.”
The deal is expected to close on or around the end of the year, subject to customary conditions and regulatory approvals.
Legg Mason had $757 billion in AUM as of July 31.