Activist investor Nelson Peltz is stepping down from the board of Legg Mason Inc. (LM) after the company changed its senior management and board, cut costs and returned more than $2 billion of capital to shareholders.
Mr. Peltz, a founding partner of Trian Fund Management LP, plans to spend more time on other commitments, according to a statement Monday from the Baltimore-based company. Trian still owns 11.3% of Legg Mason shares.
“Nelson has been a great partner for me and an important contributor to our turnaround efforts,” Legg Mason Chief Executive Officer Joseph Sullivan said in the statement. “We greatly appreciate Nelson's candor, insights and experience and are very pleased with the meaningful progress we have made to reshape the company since he joined the Board five years ago. We wish Nelson all the best and look forward to continued dialogue with Trian as Legg Mason's largest shareholder.”
Mr. Peltz, who is known for pushing companies to improve their share price, gained a board seat in 2009 after Trian took a stake, then spurred it to cut costs and boost profit. In October 2012, Mark R. Fetting stepped down as CEO amid pressure from Mr. Peltz and Mr. Sullivan took over. Since then, Legg Mason shares have more than doubled.
In October, Legg Mason attracted the most new money in more than seven years, after Bill Gross's departure from Pacific Investment Management Co. prompted investors to reallocate their funds. Its assets under management rose to $719.5 billion as of Oct. 31, from $707.8 billion at the end of September.
Under mr. Sullivan, Legg Mason “increased shareholder value, strengthened its balance sheet, is seeing positive net flows and is positioned for future success,” Mr. Peltz said in the statement. “Trian is very pleased with Legg Mason's growth and development and believes that Legg Mason's strong and dedicated board is keenly focused on the creation of long-term shareholder value.”