by Miles Weiss
Raymond Mason, who pursued mergers and acquisitions over a four-decade span to expand Legg Mason Inc. into one of the largest money managers in the US, has died. He was 88.
He died on Aug. 22 in Naples, Florida, according to a statement from his family, which didn’t provide a cause.
In 1962, with $200,000 borrowed from local businessmen, Mason opened his own brokerage, Mason & Co., in Newport News, Virginia. He was 25 at the time. The firm grew to six offices with 60 brokers by 1970, when it merged with Legg & Co., a Baltimore firm dating to 1899 whose partners were aging.
With Mason at the helm, more mergers followed, culminating in a 2005 deal valued at $3.7 billion in which the firm swapped its brokerage for Citigroup Inc.’s $400 billion asset management group.
Mason retired in 2008. In 2020, Franklin Resources Inc. acquired Legg Mason for $4.5 billion in cash plus debt.
Known as Chip, Mason took pride in his firm’s reputation for integrity. “We have an ethic that is very strong,” he told MarketWatch in 2004. “If you talk to anybody here, they’ll laughingly refer to my comments about chalk, because I’m always telling them I don’t want them anywhere near the line.”
The firm’s flagship fund, Legg Mason Value Trust, beat the S&P 500 Index for 15 years straight until 2006 under star manager Bill Miller, whom Mason hired in 1981.
Mason, a fan of the Baltimore Orioles baseball team, was a civic leader in Baltimore. He helped build new stadiums for the Orioles and the National Football League’s Ravens and served as chairman of the board at Johns Hopkins University.
His alma mater, the College of William & Mary in Williamsburg, Virginia, named its business school the Raymond A. Mason School of Business in 2005.
Raymond Adams Mason was born on Sept. 28, 1936, in Lynchburg, Virginia, to Raymond Mason and the former Marion Adams. He was 7 when his father died, and he moved with his mother to Bethlehem, Pennsylvania.
After graduating from William & Mary in 1959, he returned to Lynchburg to work at his uncle’s brokerage firm, Mason & Lee Inc.
“They could’ve been in advertising and I would’ve gone into advertising,” Mason said, according to a 1998 Institutional Investor story.
The firm created by the 1970 merger of Legg and Mason had more than 500 employees and commission volume of about $12 million, according to the Washington Post. Mason served as president. In 1973, it merged with New York-based Wood, Walker & Co. In 1981, it combined with Mason & Lee, his uncle’s old firm.
In 1983, Legg Mason offered shares to the public. It diversified into mortgage lending, investment banking and mutual funds. Mergers with other firms continued, but the new companies were generally left in place instead of moving to Baltimore and becoming integrated into Legg Mason’s operations.
“Staying in their normal locales is a matter of esprit de corps,” Mason told Forbes in 2006.
The 2005 deal with Citigroup fully transformed Mason’s firm into a financial manager. Wall Street applauded the transaction, with Legg Mason stock rising 44% in the months after it was announced.
Legg Mason encountered mixed results in the wake of the deal, however. By 2008, when Mason retired, the share price had fallen to half its 2006 high.
Legg Mason lost market share for years. Its assets declined from their peak in 2007, pushed down by client redemptions. It struggled to compete in an industry that had come to be dominated by a few large index fund managers.
In 2019, Legg Mason agreed to add activist investor Nelson Peltz to its board for the second time, along with Ed Garden, Peltz’s partner at Trian Fund Management. The two new directors said they would focus on reducing costs, driving revenue growth organically and increasing profitability.
Legg Mason’s assets under management were $806 billion in January 2020 on the eve of its purchase by Franklin Resources. The acquisition created a fund giant with $1.5 trillion in assets.
With his wife, the former Rand Riviere, Mason had four children: Paige Littleton, Pamela Mason, Carter Mason and Morgan Mason. He also had two stepchildren, Hayward Howard and Pike Howard.
Copyright Bloomberg News
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